Slightly upgraded answer from @David George:
public static double distance(double lat1, double lat2, double lon1,
                              double lon2, double el1, double el2) {
    final int R = 6371; // Radius of the earth
    double latDistance = Math.toRadians(lat2 - lat1);
    double lonDistance = Math.toRadians(lon2 - lon1);
    double a = Math.sin(latDistance / 2) * Math.sin(latDistance / 2)
            + Math.cos(Math.toRadians(lat1)) * Math.cos(Math.toRadians(lat2))
            * Math.sin(lonDistance / 2) * Math.sin(lonDistance / 2);
    double c = 2 * Math.atan2(Math.sqrt(a), Math.sqrt(1 - a));
    double distance = R * c * 1000; // convert to meters
    double height = el1 - el2;
    distance = Math.pow(distance, 2) + Math.pow(height, 2);
    return Math.sqrt(distance);
}
public static double distanceBetweenLocations(Location l1, Location l2) {
    if(l1.hasAltitude() && l2.hasAltitude()) {
        return distance(l1.getLatitude(), l2.getLatitude(), l1.getLongitude(), l2.getLongitude(), l1.getAltitude(), l2.getAltitude());
    }
    return l1.distanceTo(l2);
}
distance function is the same, but I've created I small wrapper function, which takes 2 Location objects. Thanks to this, I only use distance function if both of locations actually have altitude, because sometimes they don't. And it can lead to strange results (if location doesn't know its altitude 0 will be returned). In this case, I fall back to classic distanceTo function.