Salvage npc not recognising items with cracked materia

The Calamity Salvager Not Recognizing Certain Items:

I want to sell an old Hard Leather Hunting Belt that has a cracked materia in it, but it won't show up on the list...

It's in my armory chest, but when I go to select the waist/legs/feet option, nothing comes up.

This was a previous report by another user that was rejected because of not enough info.

I have the same problem.

I have:
Straw Hat Double meld
Leather Mitts Single meld

Whats common to both these items is that the cracked materia shows as a red circle with a white dot in the middle.
It looks like the materia was melded but added reduced stats to the item. That would seem to be a problem in the conversion of a valid meld in 1.0 to a "reduced stats added to item" meld in 2.0.

It looks like the Salvage npc does not recognise such items as melded items and effectively ignores them.

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