Machine works as expected with initial quality levels that share names with Vanilla. But when it comes to new qualities, it does not function.
I have noticed this with "Ultimate Quality" mod. It adds a "normal+", "uncommon+" etc between main groups and several qualities on top. Normal, Uncommon, Rare, Epic and Legendary items upgrade to their + variants as expected. However, the + variants do not upgrade to the next "tier" (so Normal+ remains itself instead of upgrading to Uncommon), same for fully custom qualities.
While probably not intended behavior, I'm not sure if it's possible to fix (perhaps you have to refer to quality names individually to make it function).