The solution i found was to go to settings -> displays -> advanced -> show resolutions as list. Then i selected any other resolution and then wallpaper worked. It continued to work even when I switched it back to the original resolution. I like to put the answer first so people dont have to read too much to get what they need. After updating to Sonoma my desktop was grey. I tried resetting NVRAM and PRAM didnt work. Also tried selecting all different wallpapers and nothing worked. Finally I hooked up an external monitor and to my surprise when I used the external as an extended display all the wallpapers were working on the extended one while my main wallpaper remained grey. Hooking up the external brought up the resolution options for the main that weren't visible before. I changed the resolution for the main and then the wallpapers started to work.