If I've got a battlesuit device that is 16 feet tall, and the guy inside is normal sized (like Obadiah Stane in Iron Man) would I use Growth on the device? Can growth on a device be permanent?

or just pay the cost for increased size?

The core rules say a naturally larger character should be created by applying the permanent flaw to Growth (pg. 34). It makes sense to follow the same rule to create a device.

Yes, I think that permanent Growth would be the best to represent that sort of Battlesuit.

If the suit is normally medium sized and then experiences a temporary Growth power from some external source, the pilot inside probably wouldn't be able to operate it very well anymore.

Depends, is the growth effect aimed at the character or specifically at the device? if it's at the character, both pilot and suit grow.

The easy way is to use Growth 8 with Permanent and Innate.

Alternatively, you could build the suit as a vehicle. Look over the Mecha and Manga book for more advanced rules on that.

Well, whether you build the battlesuit as a vehicle or a device depends on the nature of the suit. If it is a Gundam or similar, then I would go with vehicle. If it is armor like Iron Man, I'd make it a device.

Now, for a powered armor that is much larger than the actual person, I would make it a permanent, innate growth on the device.