How to create multiple sidebar areas with a forloop and register_sidebars?

Pass a different id for each sidebar or you will overwrite the same sidebar again and again. You can also just leave the id argument out, and WordPress will create one automatically.

Side note:

__( $area. ' Widgets' )

and

__( 'Widgets in this area will appear on the ' . $area )

… are wrong. The translation function expects a second parameter textdomain, and you cannot use a variable in the string that should be translated.

Use sprintf() with a placeholder to pass the variable, and use a context function to explain the parameter:

sprintf( 
    _x( 
        '%s Widgets', 
        '%s = widget area name', 
        'your_theme_textdomain' 
    ), 
    $area
)