I have been playing with this some, and I got the thumbnails to show, just have to work on having them display horizontally. I am borrowing some code and made a few changes from skin1/modules/Bestsellers/menu_bestseller.tpl .
In the file /skin1/modules/Upselling_Products/related_products.tpl
replace:
<a href="product.php?productid={$p.productid}"{if $config.Upselling_Products.upselling_new_window eq 'Y'} target="_blank"{/if}>{$p.product|amp}</a>
with:
<a href="product.php?productid={$p.productid}&cat={$c at}&&bestseller=Y">{include file="product_thumbnail.tpl" productid=$p.productid product=$bestseller.product tmbn_url=$bestseller.tmbn_url}</a>
it's a start...