It's not a Vista vs. XP compatibility issue that you've heard of, it's an Office 2007 vs. earlier versions of Office issue.
In addition, the compatibility issue doesn't show up as a "corrupt-acting" file. The files types are different - .xlsx vs .xls and .docx vs .doc
The 2007 files won't open in the earlier versions of Office unless the compatibility pack is downloaded and installed.
You get a message when you try to open the 2007 files in an earlier version, not a file that opens incorrectly. Installing the compatibility is pretty simple, but I don't think that's the problem EarPollution is having.
The only thing I can suggest trying is to copy the selected "stuff" and paste it into Notepad to see if anything shows up. Maybe the text is all there but Office can't figure out what to do with it. Maybe a "less featured" app like Notepad will show the characters without having to deal with formatting.
It's a long shot, but it can't hurt to try.