Right now when you extract sprites from an atlas they all sorta drop in at their own source dimensions that unreal tries to figure out on its own. It would be helpful to designate a size and extract the atlas into even divisions of that size.
Example, Atlas of 256x256, click extract sprites and dialog box appears in which you enter 64x64 as your sprite size. Unreal outputs 16 sprites all centered on the same point unless parts of the atlas were left blank.
What happened to the old way of extracting sprites ? I was totally the opposite of OP. I liked that my sprites didnt need to be lined up. In old version Unreal Engine extracted sprites of varying sizes beautifully.
Now it is only fix 