To remove the read-only password from Word documents (XP and 2003):

Invoke MS Script editor (Alt-Shift-F11)

Search for "Password"

Results in something like:

<w:DocumentProtection>Forms</w:DocumentProtection>
<w:UnprotectPassword>E454B08D</w:UnprotectPassword>

To remove the protection simply delete these two lines or to remove the password replace the "E454B08D" with "00000000" and save the document.

Alternatively, save the document as .html

Note: this is a different form of password protection from "File Open..."

Credit: http://itmanager.blogs.com/notes/2005/04/how_to_crack_un.html

edit: MS Script Editor has been removed form Word 2007.