Her hair only looked big because it was styled that way:Michelle had pretty poofy hair (it wasn't exactly 'long,' but it was certainly 'big'), and she never looked 'teh puffy' when in the mask. I don't think it's really a huge issue. Either Nolan wants her to have short hair, or he doesn't. That's it.

Her hair was never more than shoulder-length so it was very easy to conceal under the thin mask. It probably looked more like this:

I'd prefer a long-haired Selina myself, especially since I think the shorter hairdo tends to accentuate Anne's naturally loud features. Though depending on the type of mask they choose the length may have to be sacrificed.