For the ADDRESSBLOCK
a. which version of Word are you using? If it's Word 2003, there should be
an option in the AddressBlock field dialog box for "Only include the
country/region if different than". However, you would also have to ensure
that you have correctly mapped your country field to the relevant field
(probably Country/Region) in Match fields. If it's Word 2002 I cannot
remember if you get that option - certainly, the ADDRESSBLOCK was less
capable.
b. if you can't get ADDRESSBLOCK to work how you want quite quickly, I'd
stick with the individual fields option. (Some would say "don't use the
ADDRESSBLOCK", period.) Although you can change the behaviour of the
"elements" inside the addressblock to an extent, the behaviour of the
ADDRESSBLOCK is not fully documented and so modifications should not be
regarded as supported. The behaviour of the "fields" in the first line in
particular appears to be "hard-coded". Further, any changes you make
manually will probably be lost the next time you modify the addressblock.

The advantage of the ADDRESSBLOCK is, in theory, that it should get the
general layout of the address right for each country. It's much more
difficult to do that using individual fields unless
a. you know what the layout should be or
b. you use fields that already have the text laid out how you want.

However, when it gets to the country you need something like

{ MERGEFIELD "mypreviousfield"
}{ IF "{ MERGEFIELD country \*Upper }" = "UNITED KINGDOM"
"" "
{ MERGEFIELD country }" }

and for that to work all your United Kingdom addresses would have to be laid
exactly as "United Kingdom", case variations OK, additional spaces, UK, U.K.
not OK).

Peter Jamieson