If you had to reinstall XP, you would almost certainly have needed to reinstall Office - I don't believe you could just 'recover' your applications from your backup. The new install of XP would have a 'clear' registry with no entries in it other than those required by the operating system - but when you install Office from the CD, it would create the relevant entries in the registry. I'm guessing you've now got some sort of conflict. Your shortcut points to a non-existent program - probably the version of Word you had before you reinstalled XP. Then, when you try to install Office from the CD, it's conflicting with the 'recovered' copy of Word. I'm really not sure what to suggest except going back to the beginning and reinstalling XP, then doing a 'proper' install on all your software rather than trying to recover it.

In essence you cannot recover a programme such as Office from a backup unless it was a disc image such as by using Acronis. What exactly have you re-installed - XP Pro alone from CD or was it from the recovery discs/partition? If it came from the recovery partition it might very well have the short cut to the installation of Office itself, is this the case?

A clone is an exact copy of a drive/partition. If you clone drive C: to another drive you can then take out the original C: drive and replace with the other drive. When you boot pc up it will be/act exactly the same as if you had not taken the original C: drive out. The two drives will be identical twins.

An image is a backup copy usually compressed to make size of file smaller. It's contents are the same as a clone gets (the boot part and all the data) but it's stored in a file (you can't boot from a file) If it is an image file of the C: (boot) drive it needs to be restored - uncompressed and copied to a drive/partition before using in place of original C: connected to pc and then booted up.

You can also 'Mount' an image file to explore, browse and copy files from.

Best way I can think of to explain is: If you have ever had an .iso file that you've burnt to a CD or DVD, then you will know that an .iso is also an Image File - an image of a CD or DVD that you have to burn before you can play the CD/DVD.

"Once I could get XP running I then cloned back from my external HDD which should in theory put it back exactly as it was when working including program files and all other data"

The above doesn't seem to be a very good way to be doing clones..

If you're not using Acronis what program are you using? the usual way is to boot from the programs CD to start - not from XP that is on the C: (that you will overwrite with the clone..?) program would only have to close down XP and restart the pc so why bother with reinstalling XP?