In answer to your question, Burns or McGee, my answer would be a resounding yes!
They’re both great makers, although their methods differ somewhat. I have a McGee GLP, and had a Burns Folk flute before the McGee. I should probably add that my McGee is his MDT design, and has no tuning slide. Both have longer than normal tenons where the head connects, and as such are completely tunable for most situations. Both were in tune for me with the head pulled about 1/4."
As far as keywork is concerned, Casey Burns will not put keys or a tuning slide on the folk flute, so if you want to add keys later, you’ll have to get one of his regular flutes. On his regular flutes, he uses post-mounted keys, so adding keys shouldn’t be a problem for him, although you’ll be without your flute while he does the work. Terry uses block-mounted keys, so f you want to add keys to one of his flutes, then he’ll make a new body for the flute with the blocks in place and put keys on that. Then you can either trade in the keyless body or keep it and buy the keyed body to go along with what you have. (I believe that this is still the case… Terry?)
From Terry you can order the MDT design and add a tuning slide later if you want (this is how I ordered my flute, and saved $400). I asked him last year what it would cost to add a tuning slide to my existing flute, and he said, you guessed it, $400. My guess (and it’s only that, you’ll have to ask) is that Casey has some similar policy.
On your question about flutes for small hands, the folk flute that I had was in the standard configuration, not the “small hands” layout, and the measurements were VERY similar to the GLP that I have now, although the Burns had a little bit of offset in the tone holes, #3 and #6, I believe, while the GLP has the holes in line. Hole size was pretty close as well.
Someone asked about hole measurements on the GLP. These are the measurements on mine. The T designation in the chart is for a C-nat thumbhole.

NOTE: I believe that I took the distance measurements as center-to-center measurements, not edge-to-edge, but it’s been a couple of years, so I can’t be sure without looking at the flute.
Additionally, here’s a chart with the measurements of all of Terry’s flutes:

Thanks to whoever gave me the comparison chart… Was that you Jordan?
I hope this helps. Regardless of which maker you end up going with, I’m sure that you’ll get a first rate flute.
Good luck!
dow