Growing up on Neverland vs. the mainland
You are correct Peter Pan in fact is growing up. However, my explanation for this is...
When, a person is in Neverland they stop growing up.
But, once they leave the island the continue to grow again.
Therefore, with Peters trips to the mainland for that small portion of the time he continues to grow.
I think the reson Wendy said that was because she thinks Peter is growing up in the sence of mentaly as she is. But realy he is not growing up in that way she just didnt want to believe it.
You can see this when after many years Peter returns and looks the same but Wendy is very old.