It's deleting those parts of the mesh entirely at export, so it's doing exactly what you're looking for without being destructive to the model inside of Character Creator/iClone :) You can test for yourself quickly by bringing in a base character, going to Edit Mesh, drag selecting over a ton of faces, hiding them with the Visible Brush option, and turning on the option to delete hidden faces on export. Here's what it looks like after I brought the export into Maya with Delete Hidden Faces and Use Subdivided Mesh turned on in the export.
Yes, I'm aware. Thanks. But wouldn't the mesh still be taking up some memory? Or I guess since it's not hidden but actually deleted, it could be okay?
If you hide meshes or certain parts of the body using the Mesh Tool, you can turn on "Delete Hidden Faces" on export, getting rid of all the body parts and faces you don't want subdivided entirely while still subdividing the shown meshes.