I agree with the above poster concerning the confo.
She may be taking short strides as the result of stiffness. Or this may just be her hollow side. Does she do it in both directions?
Cantering on a small circle is difficult for a horse to do if she feels unbalanced and/or on the fore. Green horses typically speed up/ change pace in an attempt to keep balanced becasue they have not yet developed the correct muscles to stay in a steady stride. Is she steady on a straight line?
After you rule out any medical issues, I would suggest really working her on her hollow side. About 80% of your canter work should be in that direction to get her supple and strong.
I would advise against too much canter work on the lunge. Its much harder to keep the horse moving in a correct and collected stride and very hard on the joints.
Your mare is absolutely adorable, she's quite the pudgy girl! I love it!