ok it looks like there is quite a few issues here, lets see if I can clear a few up for you all.
first up is units: by default 1 blender unit is the same size as 1 unreal unit witch gives you 2 possible workflows, 1:leave the units in blender at there default (use 1 blender unit as 1CM) and just model to the size you want(you may need to change the cameras clipping distance for when you make big meshes), so if you make a cube that’s 100x100x100 in blender and export with scale of 1 it will bee 100x100x100 units in unreal, 2:change the units in blender to metric with unit scale set to 0.01(like you have), you have to set the unit scale to 0.01 or blender exports 1M at the size of 1 blender unit so it would be 1 unit in UE4 making your mesh tiny. personally I use the first method, its easier/more accurate and the snapping tools work better. you should also create you models at the size you want them to be in engine, I notice your mesh is quite small in both blender and UE4.
next up is orientation: by default UE4 uses X as forward and Z as up, you should do the same (while you could use Y as forward you are creating more work for yourself), I should also say that +Y in UE4 is opposite +Y in blender so if you make your mesh with +Y as forward in blender when you import to UE4 -Y will be forward.
root bone: for your root bone you want to have it as the parent of the hips bone, it needs to be at location 0,0,0 (so where the little dot is in between yours characters feet), and you need to turn on the show bone axis setting and move the tail of the bone around until the bones axis match the axis widget in the bottom left corner of the viewport.
exporting: there are obviously 2 options, to use the old exporter you need to modify it so the extra bone is not added and if you’ve done what I said above you shouldn’t need to change the up/forward settings and then just use the “use TOA ref pose” option during import to UE4 and it should be facing the right direction, you will probably see the bones axis have flipped/switched but as it doesn’t effect the anims it doesn’t matter. to use the newer exporter do the same except you don’t need to modify it although last time I tried it there were a few issues, I would recommend using the old exporter.
as to your problem with the arm there are 2 possible causes that come to mind, 1: a skinning/weighting issue (yours look ok in the pics), 2: a skeleton/bone issue, if its a bone issue try selecting the rig in object mode clear scale/rotation and location and then re-apply them, re-export and give it go.
as a side note you can scale in object mode but you have to be careful, scale the skeleton first (the mesh should scale up with it), apply scale to the skeleton and then select the mesh and apply scale.
I think that covers all of it(might have missed something as I am typing while playing destiny), anyway hope that helps:), oh and if you’ve done everything and have any more issues with the exporters let me know and I’ll post a link to my custom one;)
