Well, I wallowed around in this one long enough. It seems that simply adding a DoEvents after the Documents.Add method eliminates the anomaly.
Sub Demo_LostSelection_AnomolyI()
Dim oRng As Range
Dim oDocTmp As Document
ActiveDocument.Range.Text = "One two three"
ActiveDocument.Words(1).Select
Set oDocTmp = Documents.Add
DoEvents
oDocTmp.Close wdDoNotSaveChanges
'Notice after the procedure runs that the selection is reset to the start of the page.
lbl_Exit:
Exit Sub
End Sub
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