That's right! You cannot use Masonry because you are using subcategories, and if you read the description of this parameter you will see that subcategories cannot be displayed with 'Enable Masonry Layout=Yes'Here's what I noticed, as soon as I turn off the "Enable Masonry Layout" to the no position, the category pictures appear.
Enable or disable Masonry layout for Category View. Be aware, you need to choose the right theme (e.g. theme Simple) to display Masonry layout properly. Some parameters will be automatically disabled for Masonry layout (e.g. Display Back Button, Display Subcategories On Each Page, etc.).
Kind regards,
Benno