Once you activated the plugin in the WordPress admin plugin list, it automatically adds the option allowing people to choose from a list of suggested avatars.
So in the BuddyPress settings admin area, you should already have 5 tabs :
- Avatar Suggestions
Now if for example you go in the BuddyPress settings tab, you should see the 'Avatar Suggestions' option is already checked. So you don't need to change this.
Actually if this option is unchecked then the Avatar Suggestions tab won't show..
If you have the Avatar Suggestions tab in the BuddyPress admin area, you can go there and begin adding your suggested avatars.
Once done, suggested avatars are targeting users that didn't already upload an avatar. In the description of the plugin i added a "NB" to try to explain that behavior :
NB : in the user's "change avatar" profile page, the list is only showing if the user has not uploaded an avatar yet.
So if the user never uploaded an avatar and is a mystery man or has a gravatar, then the suggestion list will show. Again if the user has uploaded his avatar, the list won't show.
I've tested this plugin on WP 3.4.2 and BP 1.6.1 (single or Multisite) and in WP 3.5 RC1 and BP 1.7 bleeding. Everything seems to work fine. I hope this explanation will help you fix the trouble.