Have you tried using it under another user account?
If there's a difference look in C:\Users\username\AppData\Roaming\Microsoft\Office for the Word pip file and try copying it over.
This advice was key. Thanks, man.
A couple of days ago I installed a trial of Act! (contact manager). It apparently installed some slop into Word - custom menu commands - in order to handle mail merges. This coincided with the broken Word.
I followed Phil's advice, and found and renamed word11.pip to oblivion. The next time Word was started it nags me with a message box that asks something like "The Act! Add-In was not installed correctly. Do you want to disable the menu commands?" I chose "Yes" and it came up instantly.
Now Word comes up instantly. The "Disabled Menu Items" selection in the About box displays the an item for the Act! menu.
Now, back to well deserved hating on !!^*!@&!^@ Word and Microsoft.
Grey f*cking GOO. Absolutely no way for a mere mortal to diagnose the software's failing. I found and corrected this problem by sheer random chance.
I'm sure the twerps at Microsoft who developed, maintained and managed Word's development beat their chests over a job well done. Well, they are bad developers for making a possible user error this difficult to identify.