The word macro removes all the hard line breaks within a paragraph, leaving either indented paragraphs or paragraphs with a blank line between them, as one prefers. It also sets the font size to something sensible on the Reader - by default I think it sets it to 18pt, but that's easily changed.
It doesn't touch quotes, etc.
It's NOT intended to be a fancy conversion tool - just a quick "tidy up" to make a PG text file look pretty nice on the Reader. Take a look for yourself - there's a link to it on the Wiki page. It's what we all used before BD came along and it's still useful for "quick and dirty" processing.
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