Maybe Prince Dastan is a little larger than the villains? Both Setam and Zolm are pretty close in both height and proportion to Indy. Here's a comparison shot between a ARAH GI Joe, Indy, Setam, a 25th style Joe, and Iron Man. I swear they were all lined up evenly and there is no trickery going on. Sorry for the low quality capture:
<a href="http://www.flickr.com/photos/33194829@N08/4579653703/" title="Size Comparison by tymorg85, on Flickr"><img src="http://farm5.static.flickr.com/4033/4579653703_7055209494.jpg" width="500" height="239" alt="Size Comparison" /></a>
As you can see, Setam and Indy are very close in height, almost eye-to-eye. Zolm (not pictured) is a little taller, although that is more owing to his turban than anything else. I certainly think that any height difference between the figures is within the acceptable, normal human range. I wish I had also included my 4" McFarlane Halo figure, because he truly is out of scale with Indy. Like I said, I have no reservation recommending the PoP figures to Indy collectors, but your preferences my vary.