Finally, a mystery is solved. When saving a document using Word 2007, image quality would decrease. At first, I thought it was due to saving as a PDF. Turns out there is an option to fix this issue and it took a long time to find it.
Compression can be disabled on a per-file basis using the following steps:
Click the Office Button, and then click Save As.
Click Tools, and then click Compress Pictures.
Click Options.
Click to clear the Automatically perform basic compression on save check box.
Click OK.
In the Compress Pictures dialog box, click Cancel.
Note: Clicking OK on this dialog will not prevent the issue from occurring.
You can also modify a registry setting to prevent basic compression from occurring by default.
For further details see:
https://docs.microsoft.com/en-us/office/troubleshoot/office/office-docuemnt-image-quality-loss
Update: Another option is to double the size of the document. For example, if targeting a size of 8.5x11, then set the document size to 17x22 and adjust margins and font size to compensate. When saving to PDF, the images will still be down-sampled to 220dpi, however, this translates to 440dpi at double the size. If printing, scale the document to 50% in the printer settings. Images will be crisp. Or...move on to libreoffice.org
"The only reason for time is so that everything doesn't happen at once." -Albert Einstein
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