The punches themselves work the triceps nicely (If you're talking about the actual "hammer punch" where you strike down with the edge of the hand...Cathe also calls punches aimed downward "hammer punches" even though they are regular-type punches where you aim with your knuckles). Cathe sometimes combines them with a lunge, which makes them more dynamic, keeps an aerobic component to them, and burns more calories. Is that what you're refering to when you talk about bending your knees?
I don't know why it would be difficult for you to bend your knees to a 90 degree angle because of your height, but with any squat or lunge move, just go down to as far as you comfortably can. Your range of motion will improve.
