As far as I know, Microsoft went to some sort of xml-based representation in their most recent version of office. If that\'s really true, then I would assume that version c
I suppose it depends on who will be using the documents. Usually only developers are comfortable with using VCSs, so you may be complicating the lives of people who just want to access via a shared drive.
On the other hand, revision history is often very important, and I often see word documents with big summaries at the top, listing all of the changes, which seems really silly.
I'm think that cloud based solutions like google docs, will probably fill this gap in the future. Or maybe just a team wiki. Generally you are trading off some of the fancier word features to have a more open sharing experience, but google docs is becoming pretty powerful.