The Sheffield-born two-time winner in the men's singles, had targeted a third Games gold at the start of the season, but was thwarted by 12th seed Malaysian outsider Nafiizwan Adnan from Malaysia in the quarter-finals.
Adnan pulled off the biggest upset of the day when he overcame the defending champion. Yorkshireman Matthew twice overcame leads by underdog Adnan but the Malaysian, who’d never before beaten his opponent, closed out the decider to claim his major 11-7, 6-11, 12-10, 4-11, 11-6 upset in 81 minutes.
Commenting on Twitter afterwards, Matthew said, “Don’t think a tweet can portray how disappointed I am to bow out at the quarter final stage at the Gold Coast but here goes.
"No matter how good your preparation, sport is about performing on the day & I lost to the better player today. Sport clearly very rarely does fairytales.”
Fellow Yorkshireman Willstrop progressed in his quarter-final, however, beating Cameron Pilley 7-11, 12-10, 7-11, 11-6, 11-6 and then overcoming Matthew's conqueror Adnan in Sunday's semi-final, winning 11-6, 12-10, 11-4 in 49 minutes and setting up a Monday morning final showdown against New Zealand's Paul Coll.
"I owe so much to (my physio) Alison Rose in Leeds," said Willstrop, "She's been an absolute wonder-woman to me all my life. She's kept me strong. I've had surgery and she's kept me going through it.
"And obviously I've had physio support from Jade (of Team England) here all the time. It's thanks to people like Alison that I can keep playing squash at 34 - and likewise Nick has had all his team to help him keep playing squash at 37. That wasn't happening 10 years ago and that's testament to the support we get."