You need to sew just on the other side of the line, towards the center of the block. Don't cut the extra out until you have finger pressed the triangle into place. If the triangle is good, cut all extra layers, if it's just a tiny bit short, leave the large block fabric and just cut the extra corner fabric. The main fabric will ensure the block is square and will trap the slightly smaller piece in the seam making it secure.
You certainly can cut the small square larger, but you need to mark the actual target triangle size on it, not mark corner to corner.