The bug¹ is not in
latex2rtf but in LibreOffice. In Microsoft Word the generated file shows the equation:
The default conversion of equations for
latex2rtf is to use EQ Fields, which is a (rather outdated) format for representing equations. The fraction in the example is converted to
\\F(1,2), which is interpreted by Word as an equation object (see https://jay-freedman.info/EQ%20field%20switches.htm for more examples).
LibreOffice tries to convert the EQ fields as well, however "Interpretation of field functions in rtf files has been buggy in any version of OpenOffice and LibreOffice" (https://sourceforge.net/p/latex2rtf/mailman/message/28943468/).
If you don't have access to Microsoft Word, an alternative is to use
tex4ht to convert to
.odt and from there to
mk4ht oolatex test.tex
libreoffice --headless --invisible --norestore --convert-to rtf test.odt
This rtf file shows the equation in LibreOffice (and Word), and clicking on the equation shows the LibreOffice equation editor which uses a somewhat LaTeX-like syntax.
¹The documentation for
latex2rtf states that some might consider RTF to be a bug and that the syntax and semantics of RTF are somewhat artistic, i.e., you can generate a syntactically correct RTF file that cannot be displayed by some/most word processors, however for these fractions it looks like LibreOffice is to blame.