The heavily tattooed man you mentioned is the protagonist named Blacksmith (played by RZA), who owns a blacksmith shop in a small Chinese village during the Qing Dynasty. Each of his tattoos holds a significant backstory, and throughout the movie, different narratives unravel based on those tattoos. These stories involve various characters and conflicts within the village and its surroundings.
So in essence, "The Man with the Iron Fists" combines multiple short stories that connect through the symbolism and meanings behind Blacksmith's tattoos.