I'm dubious of the claim that there were enough Americans who don't understand fractions to cause the product to fail. There are a huge number of reasons why a product sells poorly. It may be too expensive. It may not be the right product (too big for lunch). The place where it is being sold may have other issues.

I've only been to an A&W a couple of times, and in both cases the food was notably subpar--it seemed like something I might find in a school cafeteria, the service was slow, and the ambiance was dingy. I also don't like root beer that much so the restaurant has little draw for me. I'm more surprised that they were able to sell enough to stay in business at all. Customer confusion over the size of the 1/3 pounder is the least of their problems.