There are several possibilities for Word. You can buy or borrow a USB CD or DVD drive. You can put the CD in another networked PC and share it. You may be able to copy the entire CD to a USB stick or SD card. You could make an iso file of the CD, put that on a USB stick or SD card, then mount it on the Mini (needs additional software). Or you could use OpenOffice.org instead.
There's no absolute need to remove anything which comes pre-installed, nor is there any absolute need to do a clean re-install. It is a matter of preference. If you are happy with it as it is, then that's ok. Personally I didn't do a clean re-install, merely removed what I didn't want starting with McAfee. Some of the stuff that's pre-installed will make the Mini slower than it could be, some of it makes very little difference. If you remove McAfee, you should use some other anti-virus such as Avast or NOD32.
You can improve the performance without removing anything by decompressing the drive. Depending on what you do with the Mini, replacing the 1GB RAM with 2GB may speed things up too. If you just do web browsing and email, then the extra 1GB is unlikely to be worth it. Remember that many people who post on here are trying to push the Mini to its limits: not everyone wants to do that, but there is a middle ground between leaving it as-is, and wringing the last drop of performance out of it!
If you have a serial modem, you can't plug it into the Mini without a serial to USB adapter. If you have a USB modem it will probably need drivers. If the "modem" isn't really a modem but is some form of router with an ethernet output, then you can plug it straight in to the Mini - you may need to power cycle the router once. It is also possible you have other software required for your modem or ISP, in which case you need that too. More info is required for a better answer.