I have been playing for 16 years and still struggle with it. Like you mentioned, my fingers just aren't long enough. You can do all the stretches and exercises you want, but if your fingers/hands aren't big enough, none of it matters.
I can't play a lot of things or grip the guitar the way I should mainly because of my pinky. Not long enough and angles inward towards the neck. Reaching up or out to certain frets is physically just impossible for me to do. Bar chords just won't happen since my index finger doesn't sit properly on the strings. There will always be a muted string for me unless I press down extremely hard (which is NOT what you want to do since it fatigues you). Bar chords is just a matter of rolling your finger around to find that sweet spot. Mine unfortunately falls in an uncomfortable position. (note that my bar chord issues happen with my classical guitar which has a much wider neck than an electric. On an electric it is a lot easier and I have less problems).
So.....2 things:
1) Just keep practicing and doing stretch exercises (as in stretching your finger across the fretboard to reach further) until you can reach your max distance and feel more comfortable. Same goes for bar chords. Practice until you know it's the best you can do.
2) If you know your hands aren't capable of doing something, don't get discouraged. Just find another way to play the same thing, or adjust your hand (maybe you don't need to play ALL the notes in the chord) to make it easier to play. All part of developing your own unique style.
Like I said, I have been playing 16 years, so I know what I am NOT capable of, but still love playing and find workarounds to continue.