There are potentially several different issues here.
For Word to be able to use an "Address book" in a merge or as the data
source for Labels/Envelopes, the Address book basically has to be a "MAPI
address book". Typically this means you can use an Outlook Address book but
not an Outlook Express Address book. In theory other address book providers
that are MAPI-compliant should be useable, but
a. many address books are not MAPI-complient
b. I have certainly found it difficult to discover which popular addesss
books can work with Word and which cannot
However, nothing prevents you from maintaining address data in another
format that has nothing to do with MAPI or an e-mail client, but which can
be used as the data source for a merge. For example you could keep address
data in an Excel spreadsheet, an Access database, or in a Word document
containing a table.
Also, I notice in the Internet tools option, there are
several drop down boxes that will allow me to select Lotus
Notes (may I ask how is that used)
These drop-downs allow you to select the program that should be used by
default to deal with a specific type of activity. For example, if you select
a program in the e-mail list, when you click on a mailto: link in a web
page, Internet Explorer should start the e-mail client you specified (or at
least open its message creation dialog box). In principle, all software on
your WIndows system should use that e-mail client by default to create and
send new messages. However, in practice that will only happen if that e-mail
client is capable of satisfying all the program's requirements, and that is
not always the case. For example, my e-mail client cannot respond to
requests to create new messages from Internet Explorer.
Although many users may use a single program to write e-mail addresses,
maintain their address book (and perhaps their calendar), these are
logically different functions which might be performed by different pieces
of software, which is why there are separate drop-downs for e-mail, calendar
and address book.