I embedded a UiApp in a webpage in Google Site that contains a flextable. The width and height of the gadget can change depending on how many items are in the flextable; so when
Though it cannot be set from gadget pref, maybe you can code your Gadget code so that the frame height is updated when you change the html content. See this nice example:
https://developers.google.com/gadgets/docs/ui#Dyn_Height