Word 97 capitalizes every new line

How can I stop Word 97 from capitalizing every new line? I recently get a new PC and, when they install Word 97 – which I’ve used for years without this problem – it starts insisting on capitalizing the beginning of every line. I’ve checked Tools > Options… and under ‘Spelling & Grammar’, I have ‘Check grammar as you type’ checked.
But under ‘Settings…’, ‘Capitalization’ is NOT checked.

(I’m running Win 98 if that matters.)