I also have some bell peppers that are about a foot tall, but mine are flowering already. This leads me to believe that they might only get to be a foot tall, but these are my first peppers, so who knows?

I have planted basil with pepers for a couple of years now. They compliment ea other. It could be drought, heat, too cool of weather. Pepper plants in this area take all summer before they really start producing well.

Maybe you are watering too much... I did this with my tomatoes the first time and they were so happy producing leaves they never bloomed :)