I was trying to get a solution for this problem since ages and I finally found it!! And it is a pretty simple thing!
[I love MS Office 2007 btw]
A guy called David Overton evidently a Microsoft employee got this solution on his site http://uksbsguy.com/
[The following is directly from his site]
I have been asked this many times following up on the blog entry Installing Office 2003 and Office 2007 on the same system where once people have removed the problem with the End User Licensing Agreement (EULA) appearing every time they start Office they then get the dialogs below every time they switch between Word 2007 and Word 2003.
The fix to the problem is very simple as it turns out – simply run the following commands (by pressing the Windows Key+R or typing it into the Start/Run command box. Use the line with Office\11.0 if you have Office 2003 installed and Office\12.0 if you have Office 2007 installed. You can use both if you have both installed :
reg add HKCU\Software\Microsoft\Office\11.0\Word\Options /v NoReReg /t REG_DWORD /d 1
reg add HKCU\Software\Microsoft\Office\12.0\Word\Options /v NoReReg /t REG_DWORD /d 1
That is it. Office 2007 might want to have one more spin round the block with it’s configuration dialog box, but that should be it.