Image upload/featured image issue

My wordpress 3.7.1 installation was working just fine when it suddenly stopped attaching properly images or setting as featured.

Actually there are the following certain symptoms:
-When creating a new post:
1.via the add Media button process i select and upload a new image with the thumbnail showing properly and when i press insert into post/insert gallery a blank media box appears in the post’s textbox.
2.when i try to set a new featured image (one that is newly uploaded or one of the old images) the bottom right ‘set featured image’ widget looks like no image is selected or set. I click “set as featured image” and the modal closes but the image never appears.
-When i try to browse my Media>Library any newly uploaded image is blank with no thumbnail available and no image file appearing when clicking view (via the ‘domain/?attachment_id=…’ link).
-When browsing my ftp server directory or typing the url ‘domain/wp-content/uploads/2013/3/image.jpg’ the images are appearing just fine.
-Any images that I upload I can see in the media browser but their thumbnails there aren’t cropped like normal, it’s a thumbnail of the entire image where normally (and previously uploaded images) it’s cropped. They also don’t have pixel dimensions listed like other images do.

This is causing a major problem on a busy e-commerce site. I’ve seen others with the same issue who said it was fixed when they disabled the “Advanced Custom Fields” plugin, but I don’t have that plugin.

I did not make any changes to anything, no new plugins, no updates. It worked fine in one product listing, then I went to the next one and it stopped and now won’t work for any.