I have dealth with fitting a small rider (my wife 160 cm) on an ongoing basis over many years and many bikes. Fortunately for you 165 cm is just outside of the impossible to fit category. You don't need 650 anything. However, given that she is feeling "too stretched out" (bent over?) on a bike with 363 reach, a 70 mm stem, and short reach bars tells me that there is a problem. And I believe that problem is stack. (You didn't indicate if there was a tower of spacers.) Keep in mind also that the longer the legs and the shorter the arms, the greater the challenge of fitting the small female cyclist becomes.
You can't get a proper bike with much less then a 360 reach. That just leaves taller stack as your only option to increase her comfort. If this rider has average female proportions, and is not comfortable in a full on aggressive fit (is she racing a lot?), IMO you need to totally re-think your approach. Aero is irrelavant, only the optimum geometry is important and you have very few options. If you want to avoid a crazy spacer tower the best options are endurance bikes, and even then some spacers may improve comfort further. I know it's not what you want to hear, but the fit will be better and the rider will be happier. Look for reach as close to 360 as possible and stack of around 525. If she wants to stretch out you could switch the stem to a massive 80 or even 90 mm.
The whole issue of comfort for women on bikes goes beyond just body dimensions matching the bike geometry. A women may not be able to tolerate a bike fit that a man with identical body proportions finds to be perfect. The different distribution of mass and muscle in the body can have a big impact on what similarely sized individuals of different genders will find comfortable.
This explains a bit:
http://www.womenscycling.ca/blog/george ... rent-mens/
