I had similar issues when solving Hulk like character with really bulky muscles. When character lowers it's arms, i got fusion in tet mesh between biceps and chest area in fat mesh, later, when character raise it's arms again, i got similar stretching like you do after that "fusion"
I would like to hear how people solve this. I ended up tweaking animation to make more space for fat mesh.
I considered it's a fast hack, but maybe it's right thing to do. Because in nature fat will constrain some of your movement and not allow you to push arm too close to chest or so.
Not sure do i make any sense, because it's kind a hard to explain.
Also make sure you don't have any interpenetrations in muscle solve.
How do you guys approach to this?
Cheers,
V