...is it just the way it works?
No, the Embed questions filter automatically calculates the required height of the iframe, so that the embed height is responsive to the height of the question and feedback. There is no CSS to add.
Check that your theme doesn't change the height of iframes, or that you haven't added any CSS or script that do.
If that doesn't solve your problem, you might want to ask the lead maintainer of the filter plugin.