Peter -
What is the difference between a Volkswagen and a Porsche?
For elementary word processing - typing in the words, general arrangement,
etc., they are both word processors. For more sophisticated formatting,
composing, integration with other software apps, MS WORD has many, many more
features and capabilities.
If you just want something to compose letters, simple reports, etc. and you
don't need a whole lot more, MS Works will indeed do the job.