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Word 2007 fails with message enable macros

After enabling Macros the same message is displayed and the Word Options are not changed, even though the correct checkboxes are ticked.

This happens if there are old files in the word startup folder.

Open a document, ignore the error then check the default file locations in:-

Office Button (Top right) --> Word Options --> Save

Click the Browse button over to the right of autorecover and make sure there are no dot files in the startup folder

If there are move them to the desktop or delete them.
Now save your current document (if no document just save as doc1.docx)

Close word then try re-opening another document