Thanks for your question and for your patience in awaiting my response while I was traveling and without Internet access.
You wrote “The categories seem to be searchable but the tags are not.” Can you give more details on what “searchable” means, i.e., the steps you are using to search for assigned terms? When I type into the text box under the “Add New” label I get a list of the tags matching the text I am entering. Are you doing something different?
You wrote “I noticed when I bring up one of the images in the add media area there are Xs over the tags that are not in the image name.” I’ve just run a quick test and discovered that the latest WordPress release has changed the styling of the “Tags” area. The “Xs” are supposed to be clicked on to delete an assigned term. This looks like an MLA defect and I will investigate further. Thanks for bringing it to my attention.
I will leave this topic unresolved and post an update when I have progress to report.