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I'm too new in Calibre to give you a "good" answer. I hope that someone else could give you good advise.
However, it's not really a problem to install both Calibre, and Sony Reader Library. You can use each of them but absolutely not in the same time. You MUST quit one before launching the other.
I don' know how is the application with a PC using Windows, since i'm on a Mac, but the the Mac Application is very very slooooooooowwwwwww ! It's really a shame that programmers could release such a thing ....
I don't know if Calibre is able to handle with Word Documents. But SOny application tranform them before sending to eReader.
Personally, I create some eBooks for my own purpose (Scanning, OCR, correction, and editing in pdf or rtf format). But I don't use Word, since the file I obtained when saving in RTF format is huge.
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