Not getting appropriate output voltage from the sensor circuit. Is the Flex sensor damaged or am I doing it wrong?
Your circuit has an impedance that is a bit on the high side for direct (no buffer) connection to a PIC ADC input - usually 2.5K to 10K, depending on the model, is the maximum recommended. Yours could be as high as 17K, so a buffer amplifier might be a good idea, 

However if the sensor doesn't read sensibly on the multimeter ohms function, but the meter does read approximately correctly with 10-110K resistors, then the sensor is broken, and securing a replacement would be the first step.