It's ok for his legs to touch the vehicle seat, and it's ok for his legs to be bent. It doesn't make him unsafe, or uncomfortable. And no, you can't recline the vehicle seat a ton to make for more leg room. My older DD comfortably chose to RF in our MR65 when she was 4.5 years old, and 43 inches tall, she has long legs. The MR65 already provides a ton of leg room, compared to some other seats, because of the depth of the seating area.
Over the last 5-6 years, some vehicle manufacturers have developed some very specific rules with regards to seat recline when child restraints are installed. Some cars allow it, some don't. Some allow a few clicks, some allow none. Read your vehicle manual, it will tell you if you can or can not.
My 2yr9mo old daughter, who is outgrowing 4T jeans by length (38.5 inches, 36.5 pounds), is still happily rear facing in our My Ride 65 and our vehicle seats don't recline, since I have a car.