The TRUE/FALSE statements could be as long as, say, 'War & Peace', including tables, pictures and so on. The only proviso is that double quotes can't be included in either expression (you could use pairs of single quotes instead).

When you want to insert large amounts of formatted context, it's best to ignore the dialogues and create the fields manually. You do this via Ctrl-F9 on a PC or Cmd-F9 on a Mac. What you don't need (or probably want) is the '\* MERGEFORMAT' switches. Thus, your field code could become:

{IF { MERGEFIELD Salesforce.Custom_Field__c } = "" "Lorem ipsum dolor sit amet, consectetuer adipiscing elit. Maecenas porttitor congue massa. Fusce posuere, magna sed pulvinar ultricie’s, purus lectus malesuada libero, sit amet commodo magna eros quis urna.¶
Nunc viverra imperdiet enim. Fusce est. ‘‘Vivamus a tellus’’.¶
Pellentesque habitant morbi tristique senectus et netus et malesuada fames ac turpis egestas. Proin pharetra nonummy pede. Mauris et orci."}

or:

{IF «Salesforce.Custom_Field__c» = "" "Lorem ipsum dolor sit amet, consectetuer adipiscing elit. Maecenas porttitor congue massa. Fusce posuere, magna sed pulvinar ultricie’s, purus lectus malesuada libero, sit amet commodo magna eros quis urna.¶
Nunc viverra imperdiet enim. Fusce est. ‘‘Vivamus a tellus’’.¶
Pellentesque habitant morbi tristique senectus et netus et malesuada fames ac turpis egestas. Proin pharetra nonummy pede. Mauris et orci."}

where the ¶ is a real real line/paragraph break. In the second example, «Salesforce.Custom_Field__c» represents the mergefield that you can still insert via the dialogues. Note that there's no need for an empty FALSE statement.

__________________
Cheers,
Paul Edstein
[Fmr MS MVP - Word]