Originally Posted by TWiTCommander
since you are working with html files, try using sigil instead of word. sigil is an html editor and outputs epub. use calibre or kindlegen to convert to mobi.
i agree - although using this method still produces the greyed-out toc mentioned earlier in the post.
to take care of that, you can open the epub and insert a <refence type="toc" title="toc" href="my_toc.html"/> in the guide element of the opf before using calibre or kindlegen to convert to mobi.