Smaller wheels, yes. Bigger wheels, not necessarily. This is a matter of being able to build a frame that fits the rider and the wheels; any differences in rollout can be compensated for by changing the gearing.
In the past, 650C was a somewhat-common wheel size for small road bikes, and there was one brand that specialized in bikes for women (Terry) that used a 24" front wheel on smaller frames, but these designs have become very uncommon (I've seen one bike that uses 24" front and rear, which solves the problem of needing to carry two innertube sizes).
I agree it's unfortunate because there are inevitable design compromises trying to fit big wheels on a small bike. Here's an essay by a custom builder on wheel sizes for small bikes. Long story short, there's not enough volume to support frames and tires for 650C wheels in the mass market. More recently, 650B (which is slightly larger, 584 mm vs 571 mm) has emerged as a fairly popular size with a good selection of tires available, although I'm not aware of major bike manufacturers speccing them on smaller frames.
With big bikes, there's obviously no problem fitting a 700C wheel, and there's not really a need to put bigger wheels on bigger bikes beyond aesthetics, perhaps. That said, there are a few companies that specialize in building bikes with 32" and 36" wheels. One of the presenters on GCN is very tall, and they did an episode with him riding a 36er.
In short, there's nothing special about 700C beyond the power of having a standard wheel size. I'm curious myself how the industry landed on that particular size as the standard.