Don't know where you heard that or what "paint mode" is, but Word itself has
no such tool - Mac or PC. What your source may be referring to is that
*some* images can be right-clicked & opened in a picture editor (as can be
done in 2004), but I don't recall an eraser - nor can I find one in either
Word 2003 or 2004.
There is a Set Transparent Color tool which can be used effectively on some
images to remove peripheral fill on certain types of images. That tool is
available in both versions but it isn't an eraser. It simply makes all
pixels of the same color (determined by what color pixel you click)
transparent & is typically used to remove a solid background surrounding the
main subject of the picture so it can be set against a contrasting color of
your choice without knocking out a rectangular area. It can also degrade the
image if there are other pixels of that same color *within* the subject
content you're trying to retain.
Perhaps 2007 has something I haven't found yet, but even if it does I still
stand by my original reply - edit graphics in a program designed for the
purpose, not a word processor
HTH |:>)
Bob Jones
[MVP] Office:Mac