Membership Plugin + New Blog Template

Hello,
Multi site 3.1.2
Membership V 2.0.2
New Blog Template Version 1.2.3

New blog Template works if the Super Admin sets up a site, great.
But when a new user pays & signs up for a new site, they are created as a sub site for the Super Admin and given admin access to the main domain. (eg http://domain.com)

I want the subsite to have its own admin and site name using the default blog template. (eg http://domain.com/subsite)

I saw this thread https://premium.wpmudev.org/forums/topic/new-blog-template-not-copying-to-new-sites
and as suggested I uploaded the new blog template files to the MU folder. FTP file structure looks like this:

MU-Plugins>blogtemplatesfiles
blogtemplates.php

but it still only creates a site under the Super Admin. It never asks for the site name on the sign up process, only the user name and password. How do I fix this? Thx.