I actually think that, in hindsight, it was a good thing that season 1 was only 12 episodes long. I've considered before about how things would have been different if Buffy had been picked up at the start of the season rather than as a mid-season replacement and i don't think it would have been much better with those extra ten episodes.
The Master, whilst entertaining, was in no way as big a threat as the later Big Bads turned out to be. Ultimately he was just this ancient vamp stuck down a mystical hole sending various other vamps out to be staked by Buffy, one after another. It worked for the short season one we got but had that been stretched over a full 22 episodes it might have become a little tedious.
Also, the main point of the first season was setting the status quo and introducing the people and locations of Sunnydale. Something that they managed to do very well with the time they had. The later seasons were about expanding on the basic character traits we saw initially so it's not as if we missed out on anything just because season 1 was quite short.
No, i really do believe that the shorter season 1 actually worked to the advantage of the series. It introduced the basic concepts and characters, told an interesting (but not too drawn out) story arc and left us hungry for season 2.