Hi Mark, we have many old post where we had placed an image at the top of the content.
This images are the very first item in the wysiwyg wrapped in a <p> by wordpress after saving the post. The image has no extra classes or attributes.
I have installed the plugin and tried with and without the overwrite option enabled.
No posts has the featured image after the process that take just few seconds for 500 posts.
Maybe the problem is that we are using the plugin on a multisite?