I spent about 2 hours last night at church helping Ning Ning solve her MacBook problem. She couldn't save docx documents as the older version doc format.
Nothing to do with Normal.dotm or Normal.dot. Nevertheless, opening the docx document while holding the SHIFT key solves the problem. But I was looking for a more permanent solution.
After skimming through tons of idiotic answers online, I've finally found some good solutions. Most important one is regarding naming the Hard Drive (analogous to Computer in Windows Explorer). Ning Ning had changed the name recently, which was when the issue occur. So, we just change it back to the default "Macintosh HD", and voila!