The secret is to use the Equation Editor that came with AppleWorks, which is a standalone application (located in AppleWorks » AppleWorks Essentials » Equation Editor » Carbon » Equation Editor). It can also be used from within AppleWorks, via the Edit » Insert Equation menu item.

Create your equation in Equation Editor, and then select the equation (Command-A), copy it (Command-C) and paste it (Command-V) into Pages (or Keynote or Numbers or any other app that accepts graphical clipboard items). It looks perfect, even when resized at will.

The nice (and unexpected) surprise is that Pages actually saves the full information from the Equation Editor. To edit the equation again, you simply have to select it in Pages, copy it (Command-C), and then paste it (Command-V) into the Equation Editor (after opening a new window (Command-N) if one is not already open). The equation can then be edited, combined with others, etc., then copied back to Pages by using the same process as before.

It would be nice to have this automated, but I am willing to live with this (still someone should fix this).

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**robg adds:**The copied equation pastes as a vector image which will indeed scale perfectly to whatever size you need.

**This hint was updated on September 29th**: The edit added the information about editing an existing Pages equation back in Equation Editor.]