Gmap Location in views - exposed filter by distance/proximity and post code
It's a bit hard to say for sure but my guess is that you have missed a step when installing the location module.

For post code proximity searching the location module uses a database of postcodes and their coordinates to convert the postcode to the lat/lon coordinates that are then used to calculate whether other locations fall in the request distance.

See installation step 6 in the INSTALL.txt file of the location module.


  
  (Optional) Import a postal codes database for the countries served by your    website, to support proximity searches and other useful
  features. Postal    code databases may be found in the "databases/"
  sub-directory of the    Location module directory. The files are in
  the format of zipcodes.CC.mysql,    where CC is a two-letter country
  code such as 'us' or 'de'.
  
  Note: If your site is using table prefixes, you will need to adjust
  for this    manually, by opening the file in a text editor and
  replacing 'zipcodes' with    'prefix_zipcodes' throughout.
  
  To import the files from the command line, enter the following:
  
  cd sites/SITENAME/modules/location
   mysql -u username -p database-name &lt; database/zipcodes.us.mysql
  


Note that this proximity functionality may not work for some countries if the data is not available.