So does a comment need to be upvoted to receive a payout

Yes

And are the rewards for comments from the 25% taken from the total for the whole thread?

No, they are taken from the reward pool as a whole

And do comments increase the rewards for the whole thread?

They don't directly affect the rewards of blog writer. Although if comments are highly-upvoted, the post might appear higher on the trending page, which could result in more earnings for the blogger.