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I am using the latest versions of both WordPress and Buddypress and have installed multisite.

After installing Buddypress (and network activating it), the Buddypress admin showed up on the sub-sites (installed in sub-directories) as well prompting me to configure the component settings for each sub-site.

I know the admin should only show up in the network panel, not even the main blog admin panel, since it is network activated.

I've been struggling for a while and even created the bp-custom.php file, to no avail.

I have posted this issue on both Wordpress and Buddypress forums and was advised to post it here as it could possibly be a s2Member issue.

As far as I understand it, s2Member doesn't affect the way other plugins behave in the network. It doesn't even affect them in a single site installation. I'll ask Jason about this anyway, so he confirms this, but it seems like a BuddyPress thing.

I've tested it on a site that does not have s@member installed and got the same problem.
Guess it must be a buddypress issue.

Ah, thanks for confirming this.