Some comments:
1) You have already checked a few steps against the exact answers. I suggest you create toy problems with a known amount of random noise added to the observations. Since you know the correct answer in this case, you can see what happens with the propagation of errors. If your method works well, but poorly on real data, you might think of terrible behavior in real life, for example, that one or more of the distances is seriously wrong.
2) I don’t know why your solution only scales, since the basic data scales correctly - if I went there with taut ropes and tied them to fixed points, there would be no ambiguity. When you use SVD to solve equations (7), do you do something like www.cse.unr.edu/~bebis/MathMethods/SVD/lecture.pdf to get the least squares solution? That should give you x, y and z without ambiguity.
3) I am not at all sure how observational errors work (7). Firstly, I do not like all units. It might be worth writing the equation for the sum of the squared differences between the measured distances and the calculated distances given by x, y, z for an unknown position, and then minimizing this for x, y, z. The Wikipedia article discards this approach because of its cost, but may give you a more accurate answer, and calculating and comparing this answer may tell you something, even if you cannot use this method in practice.
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