You can forget what I wrote in my post below. The next time I went in and played, every "paint by reference" painting had turned white and lost it's image - even the one that originally seemed to have kept it's image.
I'm not sure if this issue is related to a glitch I have also had recently with the camera. My female sim was with her boyfriend and I clicked on the camera in her inventory to have them take a photo together, but the options were grayed out and it kept saying "There is no known sims around to photograph" (see screenshot attached). Meanwhile, she was literally with her boyfriend. I've never seen that before.
