I did some preliminary renders testing with tattoo application with VSS and was impressed how well it performed.  However, I am concerned how it behaves by just modifying VSS's Template Skin and let it find tattoo mapping.  Of course, your approach for separating the body parts may be the best solution.  Be aware of your UV coordinates.  Those will need to be changed depending on tattoo application.  Also, pay special attention to tattoos stretching across the texture seams.  These will be tricky.  If at all possible, I would like to see a screencap of your set up.