Basically the fragile nation rule means that if you assault units with no retreat option they could be eliminated in the assault, no elimination by multiple assaults, they simple "surrender" but only affect C or worst quality units.
Apart this if units are out of range they recover a lot less from D and B status, this is critical in FWW serie because command ranges are very short (1-2 hexes for brigades) but a lot less in PzC.
"In East Prussia '14, the Russians are modeled as having fragile morale. This
causes them to be susceptible to surrendering en masse when they are trapped and
(when they are assaulted and cannot withdraw), and it makes them more
difficult to recover from disruption and broken status when their units are detached from
their parent HQs
(outside of their command radius, and their unit names are in orange
text). This represents historical outcomes and events where these armies were powerful,
but for various deficiencies in command and unit quality they often chose to surrender
when threatened with destruction, and their fighting formations often disintegrated or
were very difficult to reform once heavy fighting commenced.
That said, keep in mind that elite formations of A and B quality units are immune
from these effects
as those formations were more reliable. Also keep in mind that when
non-elite detached units are checking for disruption recovery, they are actually one less
level in unit quality than they appear to be. So, if a unit appears as F quality, then it is
actually at "No morale". If any unit is ever at "No morale" then it will NEVER recover
from disruption until it is at least F quality again. This means that Russian units with a
base unit quality of D, E, and F will fall apart under stress and it will be very difficult for
them to recover again since special care must be taken with reforming the units back
together with their immediate HQ.