Melee combat with dynamic animations?

Well animation is my thing and I would say the most common mistake is to focus to much on bottom up design over top down needs.

So as to questions one really needs to take into consideration are you taking a top down approach or bottom up?

From top down since UE4 is not delivered with any kind of frame work you will first need to figure out how all the nuts and bolts needs to work together that results in two players being able to interact with one another so as far as game design theory goes the first requirement is to first get the player model moving as far as it’s locomotion state goes.

So

As to your question where to start I would recommend that you start with locomotion state of getting your player to first move as to the basic requirements like run walk jump ect and from there layer in the combat requirements as to the action states of combat and melee. From there you have context of what to do next built on a working framework.