No drivatar livieries showing, even though that setting is turned on, and my settings are on ultra.
So I found this problem when I first played about 6 months ago. There was no response back then. I’d really thought this would be fixed by now but… uh…
I have this issue only when I restart the race (PC).
For me, it’s easy to recreate: just go into any singleplayer free race. Same applies for the forza driver career thingy.
For me custom liveries show in career but not in free play. I guess they will never fix this
I still see no drivatar liveries in Free Play 
same, if they work on the game, maybe it’s time to add this feature, it’s not possible to race against 23 same liveries…