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Why doesn't ^KQ (Abandon Changes) work?

You may have the Word options set to Always create a backup and to not auto-save, so it can't guarantee that an Abandon Changes command would do anything (assuming Word had just auto-saved your file and you didn't have backups turned on).

The WordStar Command Emulator could force these settings, and remove the menu options so you couldn't change them back once Word had started, but then the WordStar Command Emulator would be taking responsibility for your backups. Therefore, to prevent irate users complaining that their original document couldn't be recovered, this hasn't been implemented.