if you remove the bones, skin weight the hanging arm cloth 100% to hip or root (basically so that animation doesn't effect them), then use cloth paint tool in unreal, I think you should get a proper simulation. for getting correct scale in MD, that should be simple to solve especially since you do have one working example…
you should be able to get the simulation working nicely in MD. It will be a process of adjusing the simulation settings, the resolution of the cloth, and also manually tugging and using the pins to grab and hold sections (iirc ctrl + w or something to grab and hold which gives a little locator you can move around). It is…