Time{i} is all the times from the file. To get the times of the peaks found by findpeaks, index Time{i} with the peak locations X{i}. Also, the name of the file was misspelled.
for i = 1:1
% z1 = importdata("XXsv0000"+i+".txt");
z1 = importdata("Xxsv0000"+i+".txt");
Time{i} = z1.data(:,1); % select the first column of data from rows defined in ind as time data
Veloc{i} = z1.data(:,2); % select the second column of data from rows defined in ind as velocity data
ind = 1:550; % redefine the range of indices to select data from Veloc
% find local maxima in Veloc data within the range of indices defined in ind
% returns peak amplitude (Ypk), peak index (Xpk), peak width (Wpk), and peak prominence (Ppk)
[Ypk,Xpk,Wpk1,Ppk] = findpeaks(Veloc{i}(ind));
Ypk_plot{i} = Ypk(11:35);
Xpk_plot{i} = Xpk(11:35);
Y{i} = Ypk; X{i} = Xpk; W{i} = Wpk1; P{i} = Ppk;
figure(i)
plot(Time{i},Veloc{i},Time{i}(Xpk_plot{i}),Ypk_plot{i},'dr'); % plot data against time data and mark the locations of the peaks found
grid on
legend(["data","Pick points"])
sgtitle("File " + string(i))
n_peaks = numel(X{i});
Log_Dec = zeros(1, n_peaks-1);
% t_new = Time{i}; % contains 1024 values (which is wrong) it shoud be 81x1
t_new = Time{i}(X{i})
y_new = Y{i};
for nn = 1:n_peaks-1 %
Log_Dec(nn) = log(y_new(nn)/y_new(nn+1)); % computed with n = 1 periods apart
end
%Calculate Average Logarithmic Decrement
Mean_dec = mean(Log_Dec);
%Assesses Damping Constant
damp_ratio(1,i) = 1/sqrt(1+((2*pi/(Mean_dec))^2));
end
