rtf to epub is usually a good conversion. so is rtf to mobi.
but if you find there is too much white space between paragraphs, tick the relevent boxes on look and feel page.
also, keep preprocess box ticked as that should identify chapters and build a good TOC.
some folks advocate an extra step: open the .rtf in word, select save as - other formats & save as filtered html ( somewhere on your hard drive) then add that html to calibre ( it will appear as .zip) & convert it to .epub.
the logic is that filtered. html format removes a lot of un-necessary style data, which word has added.
I don't think it necessary though. - I would only do that if my source was in .doc or docx format.
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