The key to Vista is the Administrator account.
Photoshop
Install the program as normal. Before starting for the first time, right click on C:Programs/Photoshop.exe - Properties. Under Properties, select the compatability tab. At the bottom is a check box for 'run as administrator' - check it. Close out and double click on the Photoshop.exe file. A security window will open - choose Allow.
All should be fine.
Word
I assume you have Word installed on this computer? Without it the files will not open. Also, Office 2007 has changed. The files are now called .docx. Windows has a download on their site to allow Office 2007 to be compatible with the previous versions.
http://www.microsoft.com/downloads/details.aspx?FamilyId=941B3470-3AE9-4AEE-8F43-C6BB74CD1466&displaylang=en
If you do not have Word - download OpenOffice.org 2.3 for free software to read Office documents without Office.
Your cable provider needs to get to work and get your chat-line updated. No excuse for the delay. Vista has been in beta for years.
As a user not a programmer, I have never met a Vista roadblock yet that cannot be crossed. Even itunes works with Vista finally - I think Apple delayed the update to make MS look bad and it worked.
But I do understand people's frustrations that a new OS has such a big learning curve.