The plans of the Dutch Mars One non-profit organization to establish a permanent human colony on Mars by 2023 are ambitious, to say the least. We actually have no idea on the possible adverse effects of living in lower-than-Earth's gravity (2.64 times smaller than gravity on the Earth, or simplifying it for the sake of argument - roughly one third), all data we have is only limited to adults being exposed to micro-gravitational conditions for (on average) a lot less than a year, with the current record holder being the Russian cosmonaut Valeri Polyakov that was in space for nearly 438 days. That's not even a year and a half!
But that's not even touching the surface of all the problems a human colony on Mars would be facing, even when contemplating procreation, let alone later raising colonists' offspring. Needless to say, we have never even sent any children in space, and as far as I'm aware there were no experiments made to even attempt to have sex in space (and if two love birds had a hanky panky on their own, without supervision of scientists while in space, that's none of our business, is it?). Anyway, we're dealing with a lot of unknowns here, but one related article on LiveScience discusses exactly this problem, attempting to add some perspective from the strictly theoretical standpoint on how complicated would it be to put a bun in the oven while on another planet:
Pretty difficult, actually. Space, it turns out, essentially acts as
one big birth control system. One space-sex study published last fall
predicts that cosmic radiation would bombard the body at such a high
rate during a long space trip or an extended stay on Mars that sperm
count would decrease and fetuses wouldn't be able to properly develop
in a space environment. Even though existing and proposed space
conveyances have improved radiation protection, they don't contain
nearly enough shielding to allow zygotes to develop. And even if a
baby was able to make it out of the womb, it would have a high
probability of birth defects from the radiation damage.
And that's not the end of the potential problems. Animal studies have
shown that exposure to radiation can kill egg cells in a fetus as far
along as the second or third trimester, so any babies born would be
sterile making it hard to populate a new planet.
So it might not even matter how tall children would grow on Mars, because there's a very big likelihood there wouldn't be any. But even if they were, let's consider first a few effects of Earth's gravity on our development, before we'll try to answer your last question.
For example, you might have noticed some shoes that fit your feet perfectly in the mornings might seem a bit tight later that same day, if you were on your feet for the longer part of the day. That's because your weight exerted on your feet due to gravity actually enlarged them a bit. But that's something that will normalize on its own when you sleep, right? Yes, your foot probably won't be any larger the next morning, otherwise we'd be spending a lot more time in shoe shops, maybe more than some would like it to. But the more interesting thing about this daily process is why do your feet shrink back? Because while you sleep in the horizontal position, the gravitational force pushing your body mass downwards isn't affecting your feet so much anymore, compared to when you were standing, so the body has the time to regenerate and negate that effect of your weight from the previous part of the day.
Why did I describe all this? So it's hopefully a bit easier to appreciate that gravity affects our bodies a great deal. Now, we can try and answer the fun part of your question. Would children born and raised on Mars grow taller?
According to NASA, most astronauts grow about 2 inches while they're
in space because the reduced gravity causes the fluid between
vertebrae to expand. They lose the height within 10 days of returning
to Earth's crushing gravity.
Because of the growth, NASA uses space suits that have extra room to
accommodate the additional height.
Does this quote sound familiar? It's nearly identical to what I've been describing what happens with our feet on a daily basis. It is also a well know fact that we grow taller while we sleep, not because there is any magic to it while lying horizontally, but because you give your body the time needed to reverse the effect of the gravity on it while in vertical position. We are simply genetically programmed to grow taller than we the naturally grow in Earth's gravity. So if we can rationalize this, and at the same time have actually data this growing in height happens even to adult astronauts when staying in microgravity for longer time, we can safely assume that the answer to your question is - yes.