To address your drop cap question, I had a fiddle with a macro that might be able to lead to another kludge fix approach. Try this on some selected paragraphs and let us know what the result looks like.
Code:
Sub DropCapMeHebrew()
Dim aFrame As Frame, aPara As Paragraph, aWord As Range
For Each aPara In Selection.Range.Paragraphs
If aPara.Range.Frames.Count = 0 Then
Set aWord = aPara.Range.Words(1)
Set aFrame = ActiveDocument.Frames.Add(Range:=aWord)
aFrame.Borders.OutsideLineStyle = wdLineStyleNone
aFrame.HorizontalDistanceFromText = 2
End If
Next aPara
End Sub