My theory is that if a moon's orbit is situated in between the exoplanet and a second satellite, tidal heating could occur and turn the moon into a sustainable heat source for the host planet. Could this only be possible on a large mass like a gas giant (IE Jupiter and Io) or would it be possible with a rocky planet given the right conditions?
I think you are confusing the concept of tidal heating here. Tidal heating occurs in the lesser massive of the two objects, when it is orbiting sufficiently close to the heavier body.
For example, in the case of Europa and Io (Jupiter's moons), their masses are negligible as compared to the monster they orbit. Being quite close to Jupiter (in astronomical terms), the side facing Jupiter gets very slightly pulled out of shape towards Jupiter. This creates immense amount of friction in the core of the moon which heats it up.
Nowhere is it possible at all (according to our current knowledge of moons and planets and planetary physics) that a moon can produce tidal heating in the planet it is orbiting.
However, there could be quite an interesting scenario where an exo-Earth is orbiting a gas giant like Jupiter as its moon, quite close to it. This would create tidal heating within that exo-Earth and possibly (although not quite probably) provide it with enough energy to be habitable for life.
The reason why tidal heating is not very reasonable for surface based life is that the energy produced by tidal heating is released in the form of violent earthquakes and intense volcanic activity. Such a source of heat is quite suitable for sustaining a good warm temperature for under-surface oceans though. In instances of a tidally heated moon, you would expect to find life in oceans under the surface, not any surface based life.