The MATLAB Function block is compiled before run-time (R2014b and earlier, it generates C code and compiles; R2015a and later, it is compiled just-in time). The Interpreted MATLAB Function block uses the MATLAB interpreter to execute an existing MATLAB function.
So, what does this mean? If you're just running simulations on your desktop, not much. This is likely why you do not see any difference. However, if you're generating code from your model, you cannot do so with the Interpreted MATLAB Function block.
Also, the MATLAB Function block is a lot more customizable, as you have more control over the properties (size/data type/data scope) of all the variables, you can create tunable parameters in the blocks, etc.
In summary, the MATLAB Function block is way more flexible and I would recommend using it in most situations. The Interpreted MATLAB Function block can be easier to set up if you have already have an existing function, and it lets you use the full range of MATLAB as long as you're using the model strictly for desktop simulation.
- Sebastian
