Other than there aren't 23 lines in the code shown :), the problem is actually in the line
distances = (deg2km(distance(lat1(z),lon1(z),lat2,lon2)));% Compute distances
because you save only the current value you just computed each time through the loop so you don't have but the last value at the end. Then, the same problem occurs with the next line.
Something like
...
distances=zeros(numel(stname),1); % preallocate the output array
for z=1:numel(stname)
distances(z)=deg2km(distance(lat1(z),lon1(z),lat2,lon2));
end
withinkm = distances <= 2; % Find row indexes where the distance is less than 2 km.
% Extract only those close points from the set of all points.
closePointskm = [lat2(withinkm), lon2(withinkm), c(withinkm), distances(withinkm), find(withinkm)];
...
This writes the row in the array for which the respective values was found/saved.
You'll then also need to fix up the syntax for the call to writematrix
