We too have been struggling with the mismatch between MS Word and Moodle version of word count. The discussion and suggested code changes here are very interesting, but we would much prefer if core Moodle code would do the implementation rather than adding another hack to our implementation. So, getting back to the original question, I would say yes, absolutely, please do submit this as a bug. Also, I understand and agree about text pasted from MS applications being a mess, but that's the world we live in. I think we need to do the best we can with it, as getting MS to change their minds is unlikely.
-- mike