Several places in Atahualpa, the theme checks to see whether WPMU is running by seeing whether wpmu-settings.php exists. This file has been removed in WP 3.0+, so the check always returns false, breaking ability to use images uploaded through the media uploader for the rotating image header.
WP 3.0+ has a core function is_multisite() that works nicely for this purpose. If you want to keep backward compatibility with WPMU, maybe you could do something like
if ( ( function_exists( 'is_multisite' ) && is_multisite() ) || file_exists(ABSPATH."/wpmu-settings.php") )
(Untested, but I imagine it will work.)
Thanks!