The error count in your test setup when trying to post a new ad, just keep counting up....serious issue if you ask me:
Count: 129 (and counting)
index.php?page=item&action=item_add:419
Uncaught TypeError: Cannot read property 'appendChild' of nullindex.php?page=item&action=item_add:419
addNewPhotoindex.php?page=item&action=item_add:440 add_file_field
VM456:1 (anonymous function)
I am able to upload images but only 1 is showing though the system says there are 4 and the limit is 4.
From what I see now my guess is that this theme has some serious issues and you should ask your theme creator for help.
If you made changes you must undo them....asking your host for a restore from a date you know your site was working okay is also an option to undo any changes. But your test setup is not working 100% as opposed to what you mentioned.
Good luck,
Eric