No that is not true at all. I use Office 2007 and i am able to open and use all of my old documents.
The thing you need to do with it is to make sure that when you save it to save it as a .doc not a .docx the new format so the old formats are still able to read the documents.
The way to accomplish this is to change the save settings in the Option Menu. I have done this on over 10 machines with absolutely no problems.
So whoever told you that Office 2007 isnt backward compatable needs to get a brain scan. Cause they dont have a clue. No Offense. But M$ isnt that stupid to do that they know that not all offices are goona upgrade right away.
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