majority of my ringtones are created via iTunes http://www.ehow.com/how_2160460_custom-iphone-ringtones-free.html
I just use the app, when itunes is unavailable to use.
It seems as though we can tell why it doesn't get great reviews! What if you change the extension to m4a, see if you can make an AAC version, then take that version and change the extension to m4r and see if it works. Maybe there is something wrong in the app that is corrupting the file.