Using SWV's Isolation Rules to get around Office 2003 & 2007 MSI Repairs
One of the issues with running two versions of Microsoft Office at the same time, with one in the base and one in the layer, is the MSI repair that gets launched when you switch between versions. This is happening because Office is trying to change the file associations for you so the version that was just launched has ownership.
With SWV 6.1 we introduced layer isolation, which can be defined as what can or cannot see the layer and what the layer can see, well this works for many situations but sometimes you need something more granular which will let you specify specific things that are isolated, Jeremy discussed this in his article on using SWV 6.1 to virtualize different versions of Java, which is what we need for Office.
To get around the MSI repair all you need to do is create a new Multi-Size registry value named IsolationRules under the Read Only Sub-Layer (so this doesn't get deleted when you reset the layer) of the office layer and then place the following data inside it (remember to replace myGUID with your layer's GUID):
This rule states that any process of Winword.exe running in the base cannot see any of the registry keys for the layer. Alternately you can reverse the rule to:
Now one thing to be aware of is the <tab> is a tab character which is not something you can type in Regedit so you should probably create the text in notepad and then copy and paste it.