To solve the problem, I had to change the settings in DCOMCNFG to use the "Launching User".
Basically, (in Win 2k) go to start-> run and type in "dcomcnfg".
Select the Application (in my case, Microsoft Word) and click Properties.
Under the Identity tab, select "As the Launching User"
For Win XP, go to Administrative Tools -> Componant Services ->
Componant Services -> Computers -> My computer -> DCOM Config