When you say you want to store the value of 'v' from each iteration, do you mean each time step has its own corresponding 500x100 matrix? Also, since you want to plot velocity vs height, do you still need the "length" dimension? Do you wish to plot "velocity vs position(height,length) vs time"?
If you just wanted to plot velocity vs height vs time, you could make a 3-d plot using the "surf" function.
When you say you want to check how the solution evolves over time, do you mean you want to see how these 500x100 matrices change over time? Or just how the velocity changes over time with respect to one of the dimensions (length OR height)?