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Couple of friends had a Troll versus Elf hero (can't remember who) situation and weren't sure if the two of them were frightened of one another. Didn't seem to be anything in the rulebook saying the Terror-causing Troll was immune, and there's arguments for both possible interpretations.

I veered towards thinking that given that Trolls are big bullies with a very low Courage, and how the Mordor Trolls in RotK was pretty much the first one to flee when things started turning bad, it was fairly fitting that he should have to test to 'pick on someone his own size'.

Causing Terror does not make you immune to Terror.

+1, this ain't WHFB.

A unit- any unit- is always required to pass a Courage test in order to charge a terror-causer, or fail the charge.
A unit- any unit- is always required to pass a Courage test when a terror-causer makes it into hand-to-hand, or its Fight value drops to zero.
I'd give you page numbers, but I'm to lazy to bother right now.

Yeah, like I say I drew the same conclusion as yourself, we saw the RAW and some of the guys thought they'd read somewhere it cancelled out. But as you say, it doesn't.