Not really up to speed with 2007 yet but I think that the change to the Ribbon UI has changed the way your application works.
From the "Developer Considerations" section of this lengthy MSDN article:
Compatibility of Legacy Solutions and Customizations
Many companies rely on custom
applications built on the Microsoft
Office system and solutions that
integrate Microsoft Office with
third-party applications. Many of
these solutions modify the Office UI
through the Command Bars object model.
In the 2007 Office release, this code
continues to work—in most cases
without modification.
Changes made to toolbars in Office
2003 typically appear in the 2007
release on an Add-Ins tab in the
Ribbon (see Figure 18). The type of
customization that appears depends on
the original design of the add-in. For
example, if a customization added
items to the previous menu structure,
the Office Fluent UI creates a Menu
Commands group. If the custom code
added items to the built-in toolbars,
the Office Fluent UI creates a Toolbar
Commands group that contains these
controls. Toolbars added by an add-in
show up in the Custom Toolbars group.
Mouse clicks and other events on the
Add-Ins tab trigger the same results
as in the previous menus and toolbar
interface. Add-in code that executes
when a toolbar button is clicked in
the previous UI still executes when
the user clicks the corresponding
button in the Toolbars group of the
Add-Ins tab in the 2007 release.
Requests to hide menus and toolbars or
to remove controls are ignored. If
an add-in attempts to repurpose
built-in functionality by changing the
behavior of menu items or toolbar
buttons, such as Save or Print
Preview, the Office application copies
the control to the Add-Ins tab and
changes it there, leaving the original
control on the Ribbon or Microsoft
Office Button menu unchanged.
Although it is possible to remove or
disable built-in controls
programmatically in the 2007 release,
add-ins that remove or reorder menu
items and toolbar items in previous
releases of Microsoft Office have no
effect when they are loaded.
So, you may well find that you have an additional "Open" control in the Add-Ins tab.
It seems that re-purposing the built-in control is only possible using XML. From earlier in the same document:
Opportunities for Extensibility
Repurposing Built-in Controls. You can take over the function of any built-in control anywhere in the UI by writing a single line of XML that connects the custom code to every instance of the built-in control. You can modify the control to execute custom code and, optionally, proceed with the built-in functionality.
Finally, this even longer MSDN article explains how XML customization works