Here's the problem. Your mesh doesn't have any attachment sockets. (the mesh from the left is a mesh which works properly, the one on the right is your mesh)
Do something, re-export and re-import the mesh you want to edit (this is just to reset the lod levels to default), after you import the mesh, open any other character package, for example, Elf.ukx, then select a _g mesh (_g is for gloves), then click on Copy Mesh Properties
after that, select your own mesh and click on Paste Mesh Properties
In order to follow these steps you'll need to use L2Editor, since it's the only editor i know of that can open .ukx files from the game.
Either way, if this doesn't work for you, just add the socket manually, and set the proper rotation on Mesh > Rotation, as well as the Translation in Mesh > Translation.
You shouldn't need to touch anything related to LODs in order for this to work.