^ In this artist's previous Marisa x Shanghai art, Shanghai was enlarged, but still a doll.
Given the number of people in Gensokyo who can basically reshape reality to their will, a living doll getting a human pregnant seems entirely possible.
Artists tend to exaggerate the height difference. Yachiyo's 165cm while Iroha's 156cm which is only a 9cm difference in height or about 3 inches using imperial units.
Ah the N girls no wonder I know nothing about them given I don't play any of the Love Live related mobile game. I did try to play it in the past, but I was so terrible I couldn't even get past the tutorial stage...