I am sure this isn't a surprise to the experts, but I can access the TOC through my ITouch and if I bring the Word 2003 file into MobiPocket first before converting it in Cali

bre it also creates the inline TOC. And that works!
I've got to figure out where I can set the inline TOC type to a larger font as its a bit small for selecting with the touch of my finger. But I am making great progress thanks to all your great feedback.
I hope I can return the favor to others someday as my knowledge increases.