Hi @cbkuhn
Since Smart Slider 3.2 we have two different editing mode. One of them is the content mode what you are using now, which works like a page builder, and lets you build your slides quickly with great responsive behavior. You can find tutorial videos here: https://smartslider3.helpscoutdocs.com/article/1430-tutorial-video-content-mode
The other editing mode (the older one) is the Canvas mode, which you can use like this: https://smartslider3.helpscoutdocs.com/article/1479-how-can-i-move-my-layers-freely-on-the-canvas
While it lets you drag your layers anywhere, it much more complex to achieve a good responsive behavior. At the documentation you can find links to a video and written tutorial.
You can learn more about the differences between the two responsive modes here: https://smartslider3.helpscoutdocs.com/article/1522-canvas-vs-content-mode
About the thumbnails, could you please send me a link where I could see the problem?