This seems to me your real problem.
I would assume a lot of the tooling isn’t working for you.
You should not need to install anything special (besides the vscode extension) to format.
Because the LSP failed, you got that suggestion to install something because nothing is responding to the format request.
Can you enable "rescript.settings.incrementalTypechecking.debugLogging": true in your workspace and check the Output pane.
Open a ReScript file and type something, then ReScript Language Server should show you some more info.
(You may want to restart it first via vscode command)