The code is converting the uint8 integer array, Img1D, to the hexadecimal equivalent, stored as characters:
imgHex has the same number of rows as Img1D but two columns. The code then writes out the data to the text file with
fprintf(fid, '%x\n', imgHex);
But does the above not mean that the we are writing in hex the already hex'ed data? If I do the same with an image (once converted to a 1D array) of 215760 pixels, then the imgHex is 215760x2. I then write to the file (as above) and when I try to read it in again line-by-line (using getl), the result is a 431520x2 array which is twice the size of the original. In fact, just writing out one line to the file (with the above fprintf) results in two lines in the output file.
I think what you really want to be doing is to write out the hex of the uint8 data instead:
fprintf(fid, '%x\n', img1D);
Please try out the above line to see if that helps.
EDIT:
Try the following to demonstrate what is happening with the writing of the hex data in hex:
The '00' is two character equivalent of the conversion from uint8 (to hex) of the integer 0. The fprintf will then convert each character in this string to its hex equivalent. The hex equivalent for each character is '30'. And so the output is
