Cut/Paste from Word to Illustrator CS3 for Mac suddenly not working

Question

This issue regards Illustrator CS3 for Mac on a Mac Pro with 6 GB.
Exactly one week ago I created a number of Illustrator files by cutting charts from a Word 2008 document and pasting them into an Illustrator document.
In the past I have dragged the images (or clip art) or simply used Control-C or even Control-X, but by whatever method I opted for, getting the image from Word to Illustrator CS3 has not been a problem.
Yesterday I got a new chart and a request to replace an old image - one that I had created last week on Tuesday by the Drag/Drop or Cut/Paste method.   For reasons I can't begin to imagine the process simply won't work now.
I also find that if I simply select text in a Word Document, hit Ctrl-C and then try a Ctrl-V in Illustrator I don't get to see my text pasted in - ONLY if I already have a text block open and the cursor in place will I get to see the text copied over into Illustrator.  This is very strange and not at all how things have worked in the past - typically I would see the new Text Object just appear, and then I could move it to wherever I wanted. 
I have opened up a number of old files that I know were created with copied text and also opened the associated Word files (earlier versions of Word) and again find that I can't copy text over, or even move images over - even though I clearly could do this before.  I have also tried entirely new files - also with no success.
I was at an Apple one-to-one session this morning and they were more than mystified by this.  I can Cut and Paste into Adobe Photoshop Elements, but I can't even cut and paste from Adobe Photoshop Elements into Illustrator CS3.   I can drag the Photoshop file (from the Finder window) into the Illustrator document and poof - get my image that way, but it's as an image only.  If the base image in question is a vector image or something else having a plurality of elements, I can't then select the elements in Illustrator to change their color, delete them, or otherwise play with them.
I have brought up a word document on another Mac system that also has Illustrator CS3 and find that it too can't drag/drop cut/paste between the two applications.   At Apple, we did confirm that such ability is operational in the new Illustrator CS4, but none of their store systems still have CS3 to provide yet a third system to test.
I have deleted my Illustrator CS3 preferences, tried flushing the p-ram, and of course run fix and repair permissions - no dice.
My Mac systems update daily and there is nothing in the main update log that shows anything for Adobe or Office (nor do I think there should be).  Adobe Update reports that everything is up to date, and I don't see a history file to know what might have changed in the last week.   Office also reports fully up to date and happy.
As I can cut and paste the images into an email for Mail and into Photoshop, I am fairly certain that it is NOT a Microsoft Office 2008 issue.  The fact that another Mac with Illustrator CS3 also can't cut and paste suggests that is is really not something personal to my main system.
It is almost as if this is some clandestine "update" intended to encourage me to buy Illustrator CS4.  Given that I bought Illustrator CS3 less than a year ago, I really am not eager to buy the new version.   The greeting on the Adobe Support page that CS3 is no longer the current version and therefore supported was most annoying.
I am really hoping that someone out there has an idea of what to try changing, removing and/or adjusting with respect to Adobe Illustrator CS3.

Answer 1

I tried the Select by Path option - can't believe I missed it - and found it made no difference.
I actually uninstalled and reinstalled the whole app.  When I tried to simply re-install (can't remember it's exact phrase) it got part way through and then demanded another disk - but I only have one DVD with the application - the extra DVD is for tutorials and it didn't accept that one either.  So I restarted that process and chose to completely uninstall.  Then reinstalled - hey with only my one disk - gee, just like the first time.   And then it seemed to work.
I was not aware of the save as PDF option - but yes I have Adobe Acrobat Pro 9 for Mac so that option is there - and it seems to work too.  
There were of course a slue of updates, and I let them all proceed - but even with them all in place the system is fine and I can once again drag and drop / cut and paste things back and forth.   I just tried a text block and "The Quick Brown Fox" pasted in with a clipping mask about 10 times the size of the document, but other than that it was ok.  
So I have things working again on my primary system.   Will try and figure out what's wrong with the other one - but a reinstall might be the easiest game there too.