As suggested in my last post, the current SVN version of eqtexsvg.py is broken on Windows. Here's a revised patch, which adds double quotes around the file names (since they may contain spaces or other awkward characters). I've also rewritten the argument to the os.system() call, as it was hard to read, and adding all those quotes just made it worse.
Tested on Windows XP (now that I've installed pstoedit). Someone should test it on Linux.