The deal is that somebody at Sun got pissed off at Bill Gates (probably over the Java wars) and they turned their own suite of products (then Star Office) into Open Office and told the world they could have it for free--just to take away revenue from Microsoft.
Open Office is not 100% MSOffice compatible, but then again, no two versions of MSOffice are 100% compatible with each other, either. The fancier you get, the more formatting and macros and fancy stuff you do, the better the chance you'll break something. But for basic work? Yeah, it is free and there's no catch. You are helping the folks at Sun to get their vengence against Microsoft's revenue flow.
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