[Please refer to my video where I show what I'm talking about] When I click to link my character in iClone 7 they get rotated onto their back and I'm not too sure how to fix this on the unreal side. In iClone I can rotate on the X-axis to have my character standing up but it makes working in iClone extremely difficult. I don't know what to do to fix this properly, does anyone have any solutions that may help.

Suggest you can go here to submit ticket to the reallusion support team.

Try the default character if it is still the same. Most likely the problem is with your character. You might have to use 3dxchange to fix your character

Default characters work fine, is there something I can adjust in the 3Dxchange pipeline when I import my characters into iClone? 

It might also have something to do with export settings. Just a little bit and see what works

Try this:

Send the character to UE4 via LL.
In UE4, rotate the character onto its back. You must do it before linking, because you cannot change it in UE4 while it is linked.
Then activate the link. 

But do make sure to choose the UE4 preset for export.