Word 2007 Error Message: "Word could not create the work file."

Hi,

I have started getting this as an error message on opening Word 2007.

"Word could not create the work file. Check the temp environment variable."

Am not able to save any word document. Also, on trying to close Word I get this error message;

"Changes have been made that affect the global template, Normal.dot. Do you want to save those changes?"

Have checked my environment variables, User Variables are set to as under;

Variable - Value
Temp - C: Documents and Settings/ABC/Local Settings/Temp
TMP - C: Documents and Settings/ABC/Local Settings/Temp

Also, the Value in the registry HKEY_CURRENT_USER >Software >Microsoft >Windows >CurrentVersion >Explorer >User Shell Folders >Cache is as %USERPROFILE%\Local Settings\Temporary Internet Files.

Pls assist in resolving this issue.

There are 2 registry paths to change:
HKEY_CURRENT_USER >Software >Microsoft >Windows >CurrentVersion >Explorer >Shell Folders
HKEY_CURRENT_USER >Software >Microsoft >Windows >CurrentVersion >Explorer >User Shell Folders

Both have the "Cache" String which should be changed. And the correct Win7 Cache path in both entries is

%USERPROFILE%\AppData\Local\Microsoft\Windows\Termporary Internet Files

Thanks HQuest for your reply. Actually this problem faced by me is on my XP Pro machine. Anyhow for now, have resolved it by using System Restore.