This attaching a cloth to an object should work. even if the object is falling due to gravity.

Return to basics and get that working first. Do the flag and pole tutorial either online or from help docs. This constrains a cloth to a pole using constraints along vertices. Could be a transform constraint I cant remember. MOve the pole- the flag moves. Make the pole a rigid bosy and see if that works.

Then apply this to your scene.

By the way, the max settings for ncloth isn't the full slider - you can enter up to 1000 units I believe for each. But sounds like you need to work out the correct constraints, plus their max setting.