Thanks for testing this.
I have rendered your scene and it’s not working my end. You can still see sharp corners in the image below.
Could you post your render for comparison?
I get the same thing (same result in older V-Ray versions, too). I’m not sure what you’re expecting - the Round edges are a shading effect (won’t literally round the corners).
The render you posted definitely shows rounded edges, but with a large radius.
The radius value often has to be very small to get the desired result, obviously depending on the size of the objects you’re applying it to and proximity to camera. But it is a shading effect and not a subsitute for beveling.
Note that it can be applied to both geometry and shading groups, which can get confusing but both have their uses.