Auto Attach Thumbnails is a plugin to set post thumbnail from first image in post. It requires to have attached/uploaded at least one image to the post. If there’s not any image attached to the post, thumbnail won’t be generated. If the post thumbnail is already present, the plugin will do nothing.
This plugin adds the feature image ID to your post(just the same that WordPress does when you set it manually). It does not remove anything after deactivation.
Auto Attach Thumbnails also provides a capability to chose posts for generating thumbnails from the list of posts without thumbnails. A new menu item Auto Attach Thumbnails will get added under Tools menu after this plugin is installed.