According to the Microsoft tech support person I emailed (you get two free emails or calls of support), this could likely be due to an incompatibility with the installation program and the DVD player on my Powerbook.
I was given a case number, told to call Replacement Product - and much to my pleasant surprise, I didn't have to hang on hold for hours as is the norm with other companies (including Apple) and they got the replacements underway immediately.
Now I await the new disk and hope the old Pismo plays friendly with the new Office installation.