The ODF add-in for Word can be used with all version from XP to 2007 with varying requirements; for Word 2007 .NET Programmability Support must be enabled and the .NET Framework 2.0 is needed (included in Vista anyway).
After installing the add-in it gives you an additional item in the Office button menu:
Saving a document as a .ODT file is quick and easy. You can't right click the resulting file and choose open with Word (the add-in obviously doesn't work at the OS level or get called when triggering Word itself) but it is simple enough to just choose "Open ODF" from the menu.
Opening an ODF file prompts you that some elements of the document may be lost in translation an you can view the potential issues by clicking the Details button on the warning dialog:
I performed a direct comparison between the same document as a Word file and .ODT file, the results are pretty good with only a couple of minor differences but I'd imagine that once you start using some of the new features in Word 2007 there might the potential for a few more discrepancies to creep in.
(Click for full size image)