There is a limit to what can be achieved. Untimately, Word tries to keep floating shapes on the same page as the text to which they relate. Consequently, the image might change page periodically and, with this type of wrapping, you might end up with big gaps as Word tries to keep image & text together.

If you're trying to manage the positioning for final print purposes, it's probably best to leave the textbox formatted as in-line with text, so it moves up & down the page as necessary, and gives later content an approximation of the final layout, then only change the layouts to square top/bottom, etc. for the final editing, starting at the top of the document and working your way progressively to the bottom.

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Cheers,
Paul Edstein
[Fmr MS MVP - Word]