Here is an example of the problem. If I type e.g an "A" using the
center alighnment, then press enter to get to the next line, then
click on the Align Left button, the "A" becomes alighned left. If I
then click the Undo button, the result is what it should have been in
the first place: the "A" becomes recentered, while the cursor remains
on the left.

The same thing happens if I type the "A" with center alighnment, press
enter, type a "B", select the "B", and then click the Align Left
button. Both the "A" and the "B" become left alighned. If I now click
Undo, the "A" returns to its centered position, while the "B" remains
left alighned.

There are many other examples where actions I perform on selected
text, such as changing it to bold, have the effect of changing some or
all of the preceeding text as well, e.g to bold also. Using the Undo
button, as before, undo's the changes on the preceeding text, without
reversing the changes to the selected text.

I have tried reinstalling Office 2003, but this did not solve the problem.  

I have XP Professional

Any help will be appreciated.

It sounds like you are creating a "manual line break" when you press
enter instead of a "paragraph break." Typically, to create the
manually break, you have to hold shift+enter to achieve this.

<blockquote>A manual line break ends the current line and continues
the text on the next line. For example, suppose your paragraph style
includes extra space before each paragraph. To omit this extra space
between short lines of text, such as those in an address block or a
poem, insert a manual line break after each line instead of pressing
ENTER.

1. Click where you want to break a line of text. 
2. Press SHIFT+ENTER. </blockquote>

You may want to check if you shift key is stuck or even have "sticky
keys" on in WinXP. You can verify that it is indeed a line break
instead of a paragraph break by turning on the "show/hide" button on
the standard toolbar. It's usually next to the zoom percentage. A line
break is denoted by an arrow pointing to the left while a paragraph
break is denoted by the show/hide symbol, a P with a second line to
its right.

Hope this helps!!

Thanks for the comment Jdowning-ga.  The possibilities you mentioned
were good things to check, but unfortunately, are not the source of
the problem.  When I press "enter", I am indeed producing a paragraph
break, as the "show formatting codes" option shows.  I have also
checked that I do not have the sticky keys option on, and have in fact
disabled its use.

If you, or anyone, has further ideas about this problem, I'd certainly be grateful.

David

Cause:
the problem maybe cause by the style setting.Perhaps the special style
(where the "A" applied to) has been set to allow "auto updatable",when
you change the format of following words (applying the the same
style),all the words of the style will be change.
solution:
uncheck the special style setting "auto updatable"
step:
1.select the word (e.g your "A")
2.click main menu-formats-styles and formats,you get property window
"styles and formats"
3.right click the selected words format,click change...
4.uncheck the setting "auto updatable"
good luck

It might be as simple as which Im sure you already have showing but
just in case. Click on View scroll down to toolbars,click on
formating.On this toolbar
open the drop down style box. Click on clear formating nothing else
there,then click on center alignment button. Then look at the style
box it should read normal & centered. Now try typing your "A". Hope
this helps some..

Thanks a million, Boxi-ga!  Your suggestion was right on the money. 
Heaven knows how that style setting occurred.

Thanks also for the response, Denacdaz-ga.

David