C.,
I too have a very small 5 year old. He is probably the oldest in his pre-school class because his bday is 9/29 (just shy of the kindergarten cutoff). His size is one of the main reasons I did not push him to start kindergarten with all his friends - he could have been tested in early. I don't know that anyone has ever teased him about his size though! I know that kids can be cruel, but it sounds to me like there is not enough discipline in his classroom if they are allowing the kids to talk that way!!! I would certainly address the teachers with the problem and tell them to have a conversation with the class about teasing people. You obviously don't want them to call attention to your son, so make sure that you tell them to keep the conversation generic. Saying things like "your not my friend any more", "you look different", "you ugly", etc. should not be aloud and the teachers need to enforce it. If your son will tell you who the main kids are that are saying it, I would definitely tell the teachers who they are so that they can be watched and caught in that act. That way your son doesn't look like he is being a tattle tail and can't be nagged on for that as well.
Sorry to say, but it sounds more like a lack of discipline from the teachers! My school would never allow that type of talk and if I told them something like that was occuring - they would be all over it with talking to parents and the students and watching the culprits diligently!
Good luck to you. Tell your son that God made all sizes of people for good reason. I tell my son that God made him that size so that he could get things out of small places for me since I am too big. He thinks it is a GREAT thing!