Reconfigurable holographic surface (RHS)-aided integrated sensing and communication (ISAC) systems hold great promise for achieving both sensing and communication with low hardware costs and high energy efficiency. However, existing works largely overlook practical hardware impairments in RHSs, particularly faulty RHS elements with uncontrollable amplitudes, which degrade system performance if left unaddressed. This work aims to fill the gap by i) quantifying the impact of faulty RHS elements on ISAC performance and ii) optimizing the functional RHS elements to preserve the ISAC performance. Specifically, we derive the misspecified Cramer-Rao bound (MCRB) for sensing and the signal-to-interference-and-noise ratio (SINR) for communication to measure the performance loss caused by faulty elements. We then formulate an optimization problem that minimizes MCRB, subject to constraints on SINR, transmit power budget, and RHS amplitude. The high non-convexity of the formulated problem poses a significant challenge, which we address by reformulating and proposing a block coordinate descent-based solution incorporating majorization-minimization and successive convex approximation techniques. Simulation results verify that the proposed approach achieves an average 13.7% performance gain compared to the fault-unaware benchmark.