I searched and found that this happened to a lot of us. There is no replies to the question.
What you have to do as in the case with Literacy theme is put the theme in a folder, say on the desktop, then unzip it. Inside there will be another zip file in this case literacy-pro.zip That is the one to navigate to when WordPress asks you to upload the zip file. I imagine this is the case with all the themes after you download them. You need to unzip that file to find another zipped file inside that you will use when WP want you to upload per the instructions on this site and with the theme.