It looks like it could be a problem with DDE. Under XP you'd be able to check (and fix) your DDE related settings through the Windows Explorer Folder Options/File Types options. However I believe Vista did away with an easy way to get at the DDE settings.
Things to try:
Run Microsoft Office Diagnostics. You'll find it in your start menu under Microsoft Office -> Microsoft Office 2007 Tools, or type Diagnostics into the search bar.
Change the default programs for .DOC and .DOCX files to something other than Word and back again.
Repair your Office install. Open Programs and Features, click Office and choose "Change" then click repair.
Uninstall, then re-install Office.