Ok, the issue arrises when I ‘bp_core_activation_signup_user_notification_to’ and switch the confirmation email to someone other than the user… So, it’s something with the activation not be activated by the actual user.
I have this same issue. When someone creates a new user and uploads a custom Avatar, the upload seems to work, but once logged in the default Avatar shows up.
If the user then edits their profile and uploads an Avatar, it will show up and replace the default Avatar. So, in general the custom Avatar works, but not when a user first registers for the site.
It seems as though the images that get stored in the ‘uploads/signups’ directory don’t work, but images stored in the other directories do.