When you go to the edit screen for a page, on the right hand side is supposed to be "template" listed under " Attributes ", but it is missing for the Atahualpa theme and yet it is present in all other themes, including in new/fresh wordpress installs.

Is this a bug with the Atahualpa theme or has it been moved somewhere in this theme?

If you use the default theme you will see the following

Some themes have custom templates you can use for certain pages that might have additional features or custom layouts. If so, you’ll see them above.

Atahualpa options - including page/post styling, are listed under dashboard->Apearances-> Atahualpa theme Options.

Hmm, maybe I am dense, but I looked through the Atahualpa theme options before and after my post here and have yet to find what I'm looking for. Here is a screenshot of what I can't seem to find while using the Atahualpa theme:

No you not dense. If you read the quote it says 'SOME' so a theme does not have to supply templates. Atahualpa does not because of al the customization in the theme options.