This must be a bug, but here’s the solution…
Create a new physics asset with the least amount of capsules possible for a good simulation. I mean less than 10ish) - The other poster is right on that.) I used tapered for the best effect. When creating the physics asset from the body asset (skeletal mesh), I also jacked up the amount of capsules (by lowering the bone size) but then deleted the unneeded ones after the fact. This gave me good, relatively precise results on a dress.