I'm sorry that you had to end up with a whole new site! But I'm glad that you're on steadier footing now.

Just let me know if you have further questions about WP.com.

I think the issue was that it was a WP.com and not WP.org site.

I'm new to this so I can't be too specific on the details as it's well over my head at this stage in my web building process.

You may have changed these nameservers since your call from GD, but I see that the nameservers are pointing to WP.com - did you change these back? If not, that was your problem.

To answer your question of what to do now: You have multiple options! For my WP.org installation, I use BlueHost. I know a lot of people have had success with Dreamhost and HostGator as well.

You can set up your hosting and install your WP.org site (Dreamhost has one-click installation, for example), and then you can log into WP.com to redirect your nameservers to point to your new WP.org site:
http://en.support.wordpress.com/domains/change-name-servers/

I'm surprised GD gave you some pushback - if you check out the link above, there is information specifically for changing your nameservers with GoDaddy. I'm sorry you've had a frustrating experience!

Here is a lot of clarifying information that I think is really helpful to folks who are just starting out with domains:
http://en.support.wordpress.com/domains/domain-management/

Does this help you?

Now the question is. Since I registered the domain through WordPress.com (and all I want to do is use a custom theme) can I go to a company such as Bluehost or HostGator and get this to work?

http://en.forums.wordpress.com/topic/purchased-wordpresscom-domain-to-godaddy-hosting?replies=6

@auxclass - When speaking with GoDaddy, I verified that my nameservers were named properly and pointing in the right direction. From my understand (I'm a nOOb with this stuff), the issues has to do with GoDaddy not being able to recognize the information being sent from WordPress since it works through multiple IP addresses.
- This is where GoDaddy advised me to edit my DNS where I bought my domain name (WordPress) to point to their IP.
- Since WordPress uses multiple IP's instead of point to one specific, this is where the issue occurs. (If I understand what GoDaddy was saying)

http://en.support.wordpress.com/domains/domain-management/#update-name-servers

GoDaddy tells you to "Update your DNS (A record) to point to your hosting account."

The problem with that is that you can't.

You need to use a CNAME record, not A. (An A record specifies a single IP address. WordPress.com blogs don't have a single IP address; they run on many servers at once, and have many IP addresses).

So I guess my real question is: What do I do?

I purchased my domain (kineticstills.com) through wordpress with the idea of wanting to use a custom theme. Reading that i would have to host the domain through someone other than WordPress, I went to GoDaddy.

After purchasing the domain, hosting and theme I started to try and make everything work. This is where things go nowhere.

To use another source for hosting, you have to edit the DNS within WordPress. The issue with this is, you can't from GoDaddy.

I can't transfer the domain because it's been purchased under 60 days ago. I can get refunded for the hosting because it's been too long. And finally, I cannot get the website to work because of this issues.

So, does anyone have any idea on what to do?

Cliffs: domain through WordPress (KineticStills.com), host through GoDaddy (want custom theme), cannot edit DNS.