Microsoft Word 2007's document types, interface, and some features--very nearly every aspect of this word processor--have changed. With this update, Microsoft Word 2007 becomes a more image-conscious application. New picture-editing tools help you deck out documents and play with fancy fonts. Bloggers and researchers may also benefit. It's easier to get a handle on document security, but those who only need basic typing features may not want to relearn the interface or deal with the new file formats.
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What happens when you're sharing work with people who use an older version of Word? Word 2003 and 2000 are supposed to detect when you first try to open a DOCX file, then prompt you to download and install an Office 2007 Compatibility Pack. After you've done this, the older Word should convert your Word 2007 files and remove incompatible features. When you reopen that same DOCX file again in Word 2007, the file's original elements are supposed to stay intact. On the other hand, if you open an older DOC file within Word 2007, it will also run in Compatibility Mode, shutting off access to some of the newer program features, which explains why two documents within Word 2007 may display different formatting options.