I found on this forum that the customer can upload an image using the custom field setting but I am trying to figure out if its possible to use that same image to overlay the product image. For example if you had a shirt printing business and wanted the customer to upload an image and see how that image would look on a shirt. Thanks
That's not possible with the options available.
Now anything is possible if you have enough resources and/or skills to do it. So you can always customize the display of the image to handle that but it won't be easy, even if you're a developer.