I've seen a few good position players at the D1 level at 5-6 or so. They all did at least one thing really well that made it possible. Many of them had very good speed and/or range.
Tim Collins with the Royals/Omaha is listed at 5-7.I stood next to him in a high A bullpen one night. I think he is shorter than that.
Brett Butler is a short man and there are many other examples, as others have illustrated....Kirby Puckett, etc.
College coaches are more results-now oriented than pro ball. College coaches really don't care what you look like if you can help them win games.