When using skeletal Mesh merge, cloth simulation stops working

Unfortunately not, I didn’t get any response from epic regarding this and didn’t manage to figure it out myself.
Also the plugin is also only some code epic provided, it only adds the meshes together to an instance you can assign to your skeletal mesh actor, so you only have one animation BP. You can manipulate the bones in the anim bp as you are used to and therefore the meshes associated to the bone.
Also the parts you have all have to have the same skeleton you can still add sockets to the skeleto to assign armor or such.