This Worklist Item is a MATLAB/Simulink Limitation
Recursive functions cannot be converted to Simulink or Stateflow since a model reference loop will be created and that's not supported by Simulink.
You can convert the function to an S-Function or choose not to convert it, in which case a stub model will be created if it's called by another function. Another solution is to refactor the function to use loop based control flow.
For further support, contact EnSoft Support at support@ensoftcorp.com