When making master piece armor do the sub pieces also need to be Masterpieces? IE the padding for the chain mail.
No, quality of the components doesn't matter. To make MP's you just need to have the piece be grey (+50 skill over the piece difficulty) OR have a skill over 1000.
In either case, you have equal chance (16 1/3%) to make 94-99 and 2% chance to make masterpiece.