Insert picture from file causes beachballing

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Hi

Whenever I insert a graphic using insert>picture>from file ... Word can
take anything up to minute to open the dialoge box. I've done all of
the usual things to try to fix this:
trashing all the word .plist files I can find. Telling Word where to
look for pictures in the file locations in the prefs (after trashing
..plist files). I even got so frustrated by this - because I use this
feature a lot for school - that I reinstalled and updated the whole
Office suite to see if I could make it go away. No difference. I saw
all that stuff about duplicate fonts on here and, just for completeness
(though I don't expect it's related), sorted that out too.

One thing that does spring to mind is that I did once use the force
prebinding (or words to that effect) function in Onyx and noticed this
problem not long after. Again I can't say there's any causality there.

Office 2004 all latest updates
Tiger latest
G5 PM with 2GB RAM
Permissions repaired
Diskwarriored recently.

Any help appreciated.

.