Losing weight does not necessarily mean you will be physically fit or look thin, and if you work out you may be more physically fit but it does not necessarily mean you will get thin and ripped looking.
When I was first diagnosed with T2 diabetes, over the following 3 month period, I went from ~215 lbs down to ~175 lbs by walking and eating better. From there, I started lifting weights and added quite a bit of lean muscle mass and did look thinner, however, over that 18 month period of lifting I saw my weight go up to about 198 lbs, with the diet remaining essentially the same, but probably a bit heathier. I still have a layer of fat, that regardless of what I do in the gym is not giving me a 6 pack, but I suspect that is more a function of my metabolism/insulin resistance and will only be solved by a better nutritional plan vs simply buring more calories through additional exercise. I posted an article about this earlier in the thread and believe it is fundamentally correct.