Wow, she's a beauty. ....similar story; I've had my 2001 for about 15 years now but about 4 years ago I bought a 2000 model off of a guy with 577 miles on it (I have about 3,000 mi on it now). He had a bone disease and kept it all these years hoping to get better....he didn't. :-( I did give him his full asking price which was around $2,800 USD and was happy to do it.
Low mileage Gen1's are the holy grail of KLR to me (and many others) as the Gen2 redesign was a few steps in the wrong direction for what I do.
On the whole height thing; I'm 5'10" with a 30" inseam and I weigh about 190lbs so we are close in size - you really don't need to lower it IMO, it's just that you aren't used to the height and riding position - I had the opposite problem getting used to my HD Electraglide after years of offroad and MX bikes.