Quick Tutorial for measuring distance between points using QGI. The input point layer should be your 500 points layer. Then go to Vector - Analysis Tools - Distance matrix.
The target point.
The distance between two points is the straight line connecting the points. If youre using Maps in Lite mode youll see a lightning bolt at the bottom and you wont be able to measure the distance between points. Check out my b. If this is so we can easily do this extracting the information from the Digital Terrain Model.