actually there's no way you can work on a full project in udk with blender... you can export some things, like arquitectural meshes (with no smooth) or simple meshes, but when it comes to export a skeletal mesh (and animations of course) you won't find an easy way to do it, other thing is the scale, when you export an object to udk from blender you will find this object extremely small
Other one is the normal map, the normal map made from blender baking doesn't work correctly in an external program for the coordinate systems are different, it has to be modified on another program like gimp, it interrupts the work flow and it may lead to consistency and visualization errors

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