Get Office. Appleworks used to be great, but hsn't been touched in about 5 (?) years now. That's ridiculous.
Office, for the most part, is pretty good. Sure there's the usual MS bloat and small bugs, but Appleworks has its fair share too.
Having Office is almost required these days, since 99% of the world will send emails and other documents to you in Word format. The Appleworks Word translator only does basic stuff.
Word has more features, such as word art, more autoshapes, lots of formatting options.
And it's cheap now too.