As noted, the terminology of dwarfs and giants can be misleading, but I would expect in reality that a K IV (subgiant) would be a star of a little under solar mass and considerably over solar age, moving up the red giant branch and larger than the Sun.
In the game... ^^ There are a number of peculiarities (particularly with massive, hand-authored stars) where the radius is absurdly small for the mass, but this isn't one of those. As far as I can tell the Stellar Forge either does not simulate, or very strongly abbreviates the red giant branch; if you look at an HR diagram of a general sample of real stars the RGB is clearly visible; if you look at an equivalent HR diagram in Elite you see a line along the main sequence and a line of giants but nothing in between. I don't understand exactly what's going on, but where the real process produces a drawn out band stretching above the main sequence to the giants, in the game it's an abrupt transition from one to the other, and proc-gen sub-giants or smaller giants are extremely rare. For low mass stars you're either an approximately 1 solar radius main sequence star or an approximately 30 solar radius giant, no stops in between.
I think that what's happening is that the game has "bands" of luminosity for each temperature, and this star is slightly higher luminosity than the K VA band; although it's in no way a giant, the game reaches for the next luminosity band up, and calls it K IV, instead of realising that it's just a brighter (in game terms) K VA. I think this is the only way that the game produces subdwarfs; it doesn't simulate them as such, but in exceptional circumstances a main sequence star that is particularly bright for its temperature is called a subdwarf.
Hope that makes sense, I'm typing while flying...