Zoran:
The problem that you have is very common when you try to handle the application using ADO.
If you change your application to handle the call directly from word the problem will be resolve because everytime the Word version change you will not need to rewrite your mail merge routine.
The way that I always deal with Mail Merge and VFP is create a macro in Word and save it in the same document that will perform the Mail Merge. Please see the Code I used in my last application.
XX=CREATEOBJECT("word.application")
XX.APPLICATION.WINDOWSTATE = 2
IF THISFORM._pageframe1.Page2.Notary_Check_box1.VALUE
XX.documents.OPEN(SYS(2003)+"\Deed_Doc_1.doc")
ELSE
XX.documents.OPEN(SYS(2003)+"\Deed_Doc_2.doc")
ENDIF
XX.APPLICATION.WINDOWSTATE = 2
XX.RUN("Deed_macro")
XX.APPLICATION.activedocument.CLOSE()
XX.QUIT
XX = ""
The data source that word create have to be in the same directory of the document. Hope this resolve your problem.