no, not too late to transplant... go with a 3 gallon...

your plant is probably realy close to maturity, you could flower now...

how to fix the stretch...don't laugh, i'm serious. take a string and tie it to the top of your plants (one string per top). then GENTLY bend that sucker over about 6-12 inches every few hours until they are practically lying on the ground and tie them off. then, lower your light as close as you can. you can still get good results, you just need a little lst.

also consider getting more lights. if you're on a low budget, get a couple 48" flourecent fixtures and some kitchen and bath bulbs (flower spec) and put them about 1 inch from your plants (bulbs don't get hot so it won't burn)

this will give you TREMENDOUS new growth and give you plenty of verticle room.

i think you should lst, then veg for at least 2 more weeks (to get some new nodes, branches) then flower. by bending the top down, branches will become new tops, and you'l have several plants on one stem!

love, kp