Translation:Pencils are small.
Should "The pencil is short" be an acceptable translation? It departs more from the meanings of the Korean words, but adheres more closely to how an English speaker would describe a pencil.
It could be either singular or plural. Korean doesn't make a distinction, unless you have 들, in which case it's definitely plural. Whether it's plural would be understood from context.
FWIW, Japanese is the same way.
Could be about one pencil. General concepts do not require the plural suffix.
sometimes the particle -들 can be omitted. 연필 alone can either be "the pencil/pencils"
When using 은,는 whatever is attached to that is more broad. So instead of pencil it translates over to pencils.