WORKAROUND:
1) Start with a new SQL Editor window.
2) Paste the first part of the query in the Editor.
3) Send it to the Query Builder, where it will be rendered correctly.
4) Click on Add a union set operator and click on Add Union. This will bring up a new Diagram pane.
5) Click on the Query tab, paste the second query on the query tab.
6) Click the button to Visualize the SQL statement in the Query tab.
7) Click on the Diagram tab. It will render correctly.
8) Click on the Query in the query pane.
9) Click on Execute the SQL statement (F9).
STATUS:
This issue is fixed in Toad Data Point 5.0.1. This version can be downloaded from the downloads section of our website, which you can access by clicking here.