Suddenly not licensed for Microsoft Word

Hi,

Running XP on Dell Inspiron 1300 happily since May 2006. As requested, it came pre-loaded with Microsoft Word and I have many Word documents on my HD.  

Yesterday I purchased a 4GB USB Flash Drive and downloaded 'My Documents' (approximately 750MB). Seemed to work fine. But when I try to access any Word document on my HD,  the Word program comes up then says 'Preparing to install Word program' and asks for Word cd to be inserted. As far as I recall I didn't get Word cd with computer.  I tried inserting the USB Flash Drive but to no avail. Word then says 'current user not licensed' and closes. 

When I run Windows Genuine Advantage Check it now says 'Code not available. Operating system may not be licensed' 

Any suggestions?