I am in the exact same position. I’m using the Buddy theme from themeforest, but that doesn’t seem to be the issue as I get the exact same options with the default theme.
When I go to mysite/groups, then click “Create Group”, there are only two steps: Details and Settings, and neither one says a word about choosing / uploading an avatar.
This is driving me bonkers. Did you ever figure it out Gingerngo?
