Yes - lack of extension is a sure sign of tight roots. Plants must grow, that is they must increase in mass to continue living, so plants that are stalled are in decline. You can improve your plant's growth temporarily by potting up, but you can never restore it's full growth potential unless you do a full repot and correct the poor root conditions in the original root mass. Here is a copy past from a thread I'll link you to about tending trees in containers. It has a lot of information that will help you understand what is required to keep the potential for good growth and vitality high:

The timing of certain procedures is closely related to energy management, which gets too little consideration by most growers tending trees in containers. Because repotting and root pruning seem to be most misunderstood on the list of what it takes to maintain trees that will continually grow at close to their genetic potential, I will include some observations about those procedures to open the discussion.

I have spent literally thousands of hours digging around in root-balls of trees (let's allow that trees means any woody plant material with tree-like roots) - tropical/subtropical trees, temperate trees collected from the wild and temperate nursery stock. The wild collected trees are a challenge, usually for their lack of roots close to the trunk, and have stories of their own. The nursery stock is probably the closest examples to what most of your trees are like below the soil line, so I'll offer my thoughts for you to consider or discard as you find fitting.

I've purchased many trees from nurseries that have been containerized for long periods. Our bonsai club, just this summer, invited a visiting artist to conduct a workshop on mugo pines. The nursery (a huge operation) where we have our meetings happened to have purchased several thousand of the mugos somewhere around 10 - 12 years ago and they had been potted-up into continually larger containers ever since. Why relate these uninteresting snippets? In the cases of material that has been progressively potted-up only, large perennial roots occupied nearly the entire volume of the container, plant vitality was in severe decline, and soil in the original root-ball had become so hard that in some cases a chisel was required to remove it.

In plants that are potted-up, rootage becomes entangled. As root diameters increase, portions of roots constrict flow of water and nutrients through other roots, much the same as in the case of girdling or encircling roots on trees grown in-ground. The ratio of fine, feeder roots to more lignified and perennial roots becomes skewed to favor the larger, and practically speaking, useless roots.

Initial symptoms of poor root conditions are progressive diminishing of branch extension and reduced vitality. As rootage becomes continually compressed and restricted, branch extension stops and individual branches might die as water/nutrient translocation is further compromised. Foliage quality may not (important to understand) indicate the tree is struggling until the condition is severe, but if you observe your trees carefully, you will find them increasingly unable to cope with stressful conditions - too much/little water, heat, sun, etc. Trees that are operating under conditions of stress that has progressed to strain, will usually be diagnosed in the end as suffering from attack by insects or other bio-agents while the underlying cause goes unnoticed.

I want to mention that I draw distinct delineation between simply potting up and repotting. Potting up temporarily offers room for fine rootage to grow and do the necessary work of water/nutrient uptake, but these new roots soon lignify, while rootage in the old root mass continues to grow and become increasingly restrictive. The larger and larger containers required for potting-up & the difficulty in handling them also makes us increasingly reluctant to undertake even potting-up, let alone undertake the task of repotting/root-pruning which grows increasingly difficult with each up-potting.

So we are clear on terminology, potting up simply involves moving the plant with its root mass and soil intact, or nearly so, to a larger container and filling in around the root/soil mass with additional soil. Repotting, on the other hand, includes the removal of all or part of the soil and the pruning of roots, with an eye to removing the largest roots, as well as those that would be considered defective. Examples are roots that are dead, those growing back toward the center of the root mass, encircling, girdling or j-hooked roots, and otherwise damaged roots.

I often explain the effects of repotting vs potting up like this:

Let's rate growth/vitality potential on a scale of 1-10, with 10 being the best. We're going to say that trees in containers can only achieve a growth/vitality rating of 9, due to the somewhat limiting effects of container culture. Lets also imagine that for every year a tree goes w/o repotting or potting up, its measure of growth/vitality slips by 1 number, That is to say you pot a tree and the first year it grows at a level of 9, the next year, an 8, the next year a 7. Lets also imagine we're going to go 3 years between repotting or potting up.

Here's what happens to the tree you repot/root prune:
year 1: 9
year 2: 8
year 3: 7
repot
year 1: 9
year 2: 8
year 3: 7
repot
year 1: 9
year 2: 8
year 3: 7
You can see that a full repotting and root pruning returns the plant to its full potential within the limits of other cultural influences for as long as you care to repot/root prune.

Looking now at how woody plants respond to only potting up:
year 1: 9
year 2: 8
year 3: 7
pot up
year 1: 8
year 2: 7
year 3: 6
pot up
year 1: 7
year 2: 6
year 3: 5
pot up
year 1: 6
year 2: 5
year 3: 4
pot up
year 1: 5
year 2: 4
year 3: 3
pot up
year 1: 4
year 2: 3
year 3: 2
pot up
year 1: 3
year 2: 2
year 3: 1

This is a fairly accurate illustration of the influence tight roots have on a woody plant's growth/vitality. You might think of it for a moment in the context of the longevity of bonsai trees vs the life expectancy of most trees grown as houseplants, the difference between 4 years and 400 years, lying primarily in how the roots are treated.

Al

Here is a link that might be useful: Find the entire post by clicking me!

Two things that I think might be particular to NIPs:

From my understanding, they tend to develop really compact root systems, even in nature. Would they require a different technique for root pruning because of this?

Additionally, while you wouldn't want to try this until you can put the plant outside, I've heard that if you cut the trunk back, the plant should send up a new leader, either from behind the cut or from the root-level.