I have experienced the above (missing thumbnail option) for a non-plugin WP-installation based on Scientific Linux 45. GD was not missing, but php-gd was and WordPress did NOT complain about missing gd.
Using the hints here and my own findings I updated gd and installed php-gd. Still no thumbnail option.
However, a newly installed WordPress weblog2 did have this thumbnail option.
1. Export all your Worpress stuff, using "Manage->export".
(Save it on your browser-computer, make sure it is readable!)
1.a. Create a new weblog.
2. Login to your server.
3. Rename wp-config.php.
4. Backup your pictures.
DO NOT REMOVE the picture-files in "upload/..."
5. Drop the database tables from your WordPress weblog
(Maybe there is an easier way?)
6. Make sure /etc/php.ini allows enough memory to
48M works for me. 8MB was far too little!
7. Run a new install.
8. Go to write->upload and try to upload an image.
Enjoy "Thumbnails option"
9. Import your XML file from the browser computer
The old pictures will NOT be showed anymore
so you may prefer to upload them again.
I am sorry that I do not have a better work-around.
There must be a way to fool WordPress to re-run the
installation-initialization of the options in the