Not sure why you are having this much trouble. I would have thought that baltwo's instruction would have resolved the issue. I certainly find that my 10.6 Mac's are all selecting the Default printer set in Print & Fax so there must be something about the setup with this Mac.
You could try resetting the printing system. This will delete you current print queues so you will have to add them again. To reset the printing system;
1. Open System Preferences > Print & Fax
2. Move your mouse over the Printers list
3. Hold down the Control button and click the mouse (or right click if supported).
4. Click "Reset printing system ..."
5. Restart your Mac
If this doesn't help then a workaround rather than a solution would be to change the Print button used by Word. By default, the Print button is set to Print One Copy to the default printer. Using this icon never makes the Print Dialog appear, where you can change settings and check what printer is set. So if you change the toolbar icon to 'Print...', then the print dialog will appear.
With Word open, move the mouse to the toolbar and control-click. Then select 'Customize Toolbars and Menus'. Under the Categories heading, select File and then in the Commands section, scroll down until you see 'Print...'. Drag this icon to the toolbar, maybe next to the other print icon, and release. If you want to remove the existing Print icon you could drag it down to the Commands list at this stage. OK the change and now try it. When you press the icon the Print dialog should appear.
HTH
Pahu