To be honest, I've never seen a failure quite like that before so thanks for that! A couple of observations: you appear to be using an old version of Xcode (11.0.0) that may not be fully supported on 10.15.x. So I would try upgrading to the latest released Xcode for 10.15, which is Xcode 11.5 at the moment or make sure your copy of the Command Like Tools is really up to date (you don't need a full-blown Xcode to build python). xcode-select -p should show which you have selected.

You should see one of the following:

$ cc --version

Apple clang version 11.0.3 (clang-1103.0.32.62)
Target: x86_64-apple-darwin19.5.0
Thread model: posix
InstalledDir: /Library/Developer/CommandLineTools/usr/bin

or

Apple clang version 11.0.3 (clang-1103.0.32.62)
Target: x86_64-apple-darwin19.5.0
Thread model: posix
InstalledDir: /Applications/Xcode.app/Contents/Developer/Toolchains/XcodeDefault.xctoolchain/usr/bin

But that may be a secondary matter. The most interesting things in the snippet you display are the paths to the header files. for example:

/System/Volumes/Data/mathworks/devel/sandbox/aflewell/python38_source/Python-3.8.2

which are absolute paths that suggest the build process you are using is somehow using macOS sandboxes. Yet the paths to the actual source file being compiled amd its output file are unprefixed relative paths. So I suggest you figure out why those sandbox paths are in there.  A straightforward build from within the source tarball expanded in a non-sandboxed directory, for example under $HOME or /tmp, should work just fine.

Keep in mind that in any case you will still run into some missing modules like _ssl and _hashlib unless you supply copies of third-party libraries that macOS does not or no longer provides; the Python Developer's Guide has some suggestions (https://devguide.python.org/setup/#macos-and-os-x).