Same problem here - I can upload pictures to Onedrive from my computer and from my phone, but I can't download them to the phone or view them from the phone any more. The pictures show up fine in Onedrive on the web and on my computer.
On the phone, I can see thumbnails that were previously cached in both the the Onedrive album under Photos and in the Onedrive app, but I can't see thumbnails for newer uploads and I can't view / open / save any images from either the Onedrive album in Photos, or from the Onedrive app.
Going by the date that thumbnails for new uploads stopped being created and display only as grey squares with a photo icon in them, this started during the first week of June.
If I take a picture on the phone, with auto upload to Onedrive turned on, the picture is uploaded without a problem. I can view it on the web and on my computer. The Onedrive /camera roll folder in the Photos hub is totally gubbed though. After giving it a good few minutes, the same three or four recent thumbnails (the last pictures that successfully had thumbnails created) are displayed over and over again in place of all my most recent photos. None of these photos can be opened or viewed.
Lumia 1020
OS 8.10.12397.895
Firmware rev. no. 3051.40000.1345.1002