Depending on the latitudes and longitudes of your zip codes, it might be possible for it to mis-sort the distances slightly.
For instance, say you have three zip code areas in a line, west to east, in somewhat decreasing size. You have a dealer near the east edge of the western-most (#1). You have another dealer in the middle of the eastern-most (#3). You have a customer closer to the western edge than the centre of the middle one (#2). Which is going to list closer? Well, it depends on where the latitude and longitude are. If they're in defined as the middle of each area, then the customer is probably going to be told #3 is closer when he is in fact quite a bit closer to #1.
Now, this probably wouldn't happen all that often: it depends on how many dealers you have! But listing the closest 5 would tend to alleviate that and many people would understand the problem enough to overlook it, anyway.
Wade.