Word crashing when saving to Dropbox folders

[RedTomato]

I use Word almost every day for creating simple documents, and for the most part it works fine.

Yesterday it suddenly began crashing when I try to save a new document in a Dropbox folder. 

Steps for crash: Open Word. Open New document. Type something. Press Save. Save dialogue opens. Select or navigate to a Dropbox folder from the list of folders. Save dialogue briefly opens the folder then Word crashes.

The only thing that has changed is I've just installed 10.13.2 plus the 10.13.2 supplemental update. It could be one of them causing the crash. Or a new Dropbox update - I don't know if my Dropbox version was updated that day. Restarting doesn't help. 

Word does NOT crash if I save to the Desktop folder, or to external drives or USB sticks. 

System: Macbook Air 2013 13", OSX 10.13.2,

Word for Mac 2011 fully updated.  Word Version 14.7.7 (1708905)

Dropbox personal user, version v41.4.80, Finder Integration is turned off.  87% of 10.9GB used. 

Also have iCloud 2TB storage / backup turned on for all my files, working since last Nov. 

If I navigate, in the Word Save dialog, to non-Dropbox folders, all goes well. Navigating to any Dropbox folders causes Word to crash. Strange. 

I quit Dropbox and tested Word. Still crashing. I turned off Dropbox's 'Start on boot' option and restarted, and tested Word. Still crashing.

[RedTomato]

Another note for anyone who is investigating or experiencing this:

As part of my troubleshooting, I removed the bulk of my Dropbox files from Dropbox, and put them in a folder in Documents, which I (of course) called DROPBOX.

Some time later, I needed to save a file from Word into one of the folders there.

WORD CRASHES AGAIN! OFFICE CRASHES AGAIN!

I investigated further, and noticed that these DROPBOX files were not being saved to iCloud (icon of crossed out cloud next to all the files). I checked the folder info for DROPBOX, all fine. I changed the name to DROPBO. Boom! All the files suddenly started uploading to iCloud. Word saves to these folders fine!

I changed the name back to DROPBOX. Boom! Uploading stopped, icon of crossed out cloud reappears next to files. Word crashes when saving to these folders!

So. Something about iCloud & Dropbox's installation in OSX / MacOS is causing Word & Office to crash when saving to folders contained within another folder called Dropbox.

I hope that's enough for other people to be going on with. I'm unlikely to look any more into this.

[FourCandles]

@RedTomato - Thanks for the detailed info and taking the time to explain all this. I have a friend experiencing this issue so hopefully this will help solve their issue too.