In your second figure, Mesh should connect new Master bone component.
To have a cleaner code, I suggest your have a look at your default Metahuman blueprint (before your made your custom 3rd person blueprint). You’ll see a function EnableMasterPose(). It uses the Set Master Pose Component, but checks before that Torso/Feet/Legs are valid references. And then in the default blueprint construction script you’ll see how EnableMasterPose() is used. It’s almost the same, but with a little more sanitization.
For your question about your hoodie simulation, are you sure that in the torso mesh details you still have Clothing Simulation Factory = ClothingSimulationFactoryNv? (again, I skip to the most obvious potential explanation)
Best.