How do you diff two word documents ?
With some difficulty.
Word offers the ability to compare/merge two documents and shows the difference using the same "track changes" feature that can be used to show your own (and other's in another colour) edits/revisions.
However, it was always sh*t at many things, often showing a whole table as "changed" when in fact only a word or even some formatting was different, and would often flag up changes in automatic fields (table of contents, heading numberings, page numbers, etc) that really you don't normally care about because they are designed to update anyway..
Word sucks, as does Open/LibreOffice writer, but in different ways. I prefer the Office 97 version of word, even though it is more buggy and won't do odf or docx in any usable way, but that is probably down to my years of sorry experience in using it and not really liking the ribbon of later versions (though I also use 2010 at times). As others do, I often write the main multi-section document in LibreOffice to get content OK, then import to Office 2012 for final formatting for those who can't cope without Word or if there is something it does better than LibreOffice.
p.s. macros in documents are the Devil's work.
p.p.s. MS has a long and inglorious history of embedding absolute paths in linking stuff that promptly breaks when you try to edit it on another machine.
p.p.p.s. Thunderbird has also degenerated in to storing absolute paths to things, even though they are all folders/files in the same profile sub-directory so should be relative to there.Then if you move your profile to another user name, or a machine with different directory structure, random bits of your email don't appear/work any more.