category template not being applied, very strange.

http://do.right.by/wordpress

Hello,
I am relatively experienced in theming for wordpress but I am having the strangest problem. I have a category.php file but it is simply not being applied. The only template that is working is index.php .

I have no idea what I am doing wrong but my category permalink structure and child set up changed a lot until i got it how i wanted it.

I am linking front page thumbnails to the category pages with this code in my loop.

<div class="featuredthumbnail">
	<?php
		foreach((get_the_category()) as $category) {
		$category_id = $category->cat_ID . ' ';
		}
    	// Get the URL of this category
    	$category_link = get_category_link( $category_id );
	?>
	<a href="<?php echo $category_link; ?>">
	<?php
 	$image_id = get_post_thumbnail_id();
 	$image_url = wp_get_attachment_image_src($image_id,'front_page');
 	$image_url = $image_url[0];
	?>
	<img src="<?php echo $image_url; ?>"></a>
</div>

It shouldn’t matter much though because it definitely links to the right url, it just looks exactaly like the index.php

Any and all help is appreciated,
Thanks much.