OK. I was able to manually enter the URL for the attachment and was able to get the image to display within the list item. However, is there a way to display thumbnail in the Image column automatically if an attachment is present in the list item? The list users may or may not attach images and I do not want to manually enter a image URL to each item. I am guessing I need a formula or JSON to achieve this?
I don't think there is a OOTB way to accomplish what you're looking for. Although maybe you can use a SHarepoint Designer workflow to copy the URL of the image if the user uploaded one and set it to the img Field. Other than that, I believe uploading the image and having Sharepoint reference it is the way to go. Lemme know if you need any help.