If you're trying to use a DATABASE field in a normal ‘letter’ mailmerge main document, you'll need a macro to drive the process. An outline of this approach can be found at:
Many to one email merge using tables - Microsoft Community
Conversely, if you're using a relational database or, Excel workbook with a separate table with just a single instance of each of the grouping criteria, a DATABASE field in a normal ‘letter’ mailmerge main document could be used without the need for a macro. An outline of this approach can be found at:
Mail Merge - To a Word Table on a Single Page - Microsoft Community
For some working examples, see:
Mail Merge: Using One Excel File with Multiple Sheets
Merge excel list into Word Receipt
The DATABASE field can even be used without recourse to a mailmerge. An example of such usage can be found at:
Mail merge into different coloumns
As for the formatting options, see under Insert|Quick Parts|Field>DATABASE>Insert Database>Get Data: (connect to the data source) > Table AutoFormat.