So on my test site here: http://postfriendly.com/okhey/ you will see that thumbnails are showing 404 broken images rather than the featured image that is definitely set.
The blog posts in which are showing "Add image to post" are ones that I did not upload a featured image to them. Those images show up fine. I want to make it clear that I am using the settings to show "Blog Posts" from this site and NOT using "network posts"
I saw someone else having this issue but doesn't seem to resolve it: https://premium.wpmudev.org/forums/topic/network-theme-does-not-display-image-on-the-home-page
I am really wanting to use this particular theme but it is really imperative that I get the issue fixed so that user's featured image show up for each blog post. Thanks everyone