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So I picked up army builder and was using it to put together my daemonhunter army. I noticed that when i gave my Brother captain and/or grandmaster a master-crafted wargear selection it stopped giving them the +2 strength from their NFW's. Does Master-crafted indeed do that?

Please make sure your datafiles are up to date.
I cannot replicate the error with the latest datafiles.

Update the files Or just re-install them.

Also, never EVER consider Army Builder Correct. Always check your codex.