There is a workaround where, you can make a custom entity that define the hero's collision size and make all collision detections through that entity
That's certainly true, yes, but at that point one would be rewriting a significant part of the engine in lua, which is slower and more prone to logic errors (by way of being self coded rather than a meticulously bugtested project under review of multiple coders and testers)... and considering how much of the engine is already contact based, it would essentially be almost as fast to start without an engine at all.
I had considered (as I'm sure many who have wanted to change the collision size have) rewriting the collisions, but once I realized how many functions would have to also be recoded, I realized it wasn't worth the effort, for my purposes.
If I could figure out how to get my build environment to fully compile (which is my problem to deal with, not a complaint) I would probably look into the C++ side of things to try modifying it that way.
I did look briefly at one point, but as the environment wasn't completing the build, and the code itself seemed to have a lot of places where the collision was a hard coded real value instead of a named constant, variable, or object reference to be altered from a single source, I was never able to really determine what needed changing, or whether said changes would even work.
As I am currently having new ideas for potential zelda-styled games, I may try again in the near future... assuming I can ever get mingw to stop fussing.
I'm still eager to see the feature, but for now I'm just hoping it'll be addressed in the next public release.