http://www.sheldonbrown.com/handsup.html
A major limitation is the steerer tube length. No matter how many times you cut a steerer
tube it won't get longer.
Getting Riser Bars or simply flipping the stem over or getting one with a different rise and
reach might give you the added height you need. If you LIKE the handlebars, the stem is the
best and least-invasive option as most new ones come with front loaders (detachable front
caps) that allow replacement without stripping components off one side of the handlebar. In
minutes a Bicycle Shop could swap any number of them onto your bike for you to try.
If you had purchased the bike at a reputable Bicycle Shop they would have fit the bike to you
before you took it home.