The encryption type for password protected Office 97 thru Office 2003 must be set.

This policy setting enables you to specify an encryption type for password-protected Office 97-2003 files. If you enable this policy setting, you can specify the type of encryption that Office applications will use to encrypt password-protected files in the older Office 97-2003 file formats. The chosen encryption type must have a corresponding cryptographic service provider (CSP) installed on the computer that encrypts the file. See the HKEY_LOCAL_MACHINE\SOFTWARE\Microsoft\Cryptography\Defaults\Provider\ registry key for a list of CSPs installed on the local computer. Specify the encryption type to use by entering it in the provided text box in the following form:<Encryption Provider>,<Encryption Algorithm>,<Encryption Key Length>.For example, Microsoft Enhanced Cryptographic Provider v1.0,RC4,128. If you do not configure this policy setting, Excel, PowerPoint, and Word use Office 97/2000 Compatible encryption, a proprietary encryption method, to encrypt password-protected Office 97-2003 files.