I think I figured it out but it's really wierd. I was only able to see the jpgs on the jump drive when I was playing music from it on the audio system. Go figure.
I finally got it working, wish I knew how. I put the pictures on the same exFAT32 64Gb card as my music. No luck with the wallpaper. I then did the clock wallpaper and it worked, the then regular wallpaper worked.