Creating deformable mesh and colliding it with static mesh

I am working on a project where an object deforms when colliding with another object. So, I want to deform a procedural mesh by letting it collide with a movable static mesh.

image
(Orange: procedural mesh; yellow: static mesh)

  1. I worked just fine with the blueprints that I made. But once I attach the movable static mesh as a haptic cursor. It does not work anymore. I wonder why?

  2. When the static mesh is set to smaller size (0.1;0.1;0.1), the procedural mesh did not deform. It worked only when the static mesh is big enough.

Here is the blueprint I am currently using:

Any help will be much appreciated. Thanks!

Do you think it is worth to change these values in the blueprint? Does it make any difference?