Well, a word file is not defined by its extension but by its format, the extension help to determine which format the file is based on. The important point at this stage isn't how you name it but from what content you create it. According to the article you get content from a word file template.
We're going to debug step by step. We need to check result after each step. You can use the terminate control action to stop flow after the action for which we need to check the result.

1° Add terminate after first "Update file properties" action. Run flow, "Copy file" action copies file template to "Personal Certificates" folder, properties are updated, check if you can open the copied word file and if properties are correctly set.
2° Delete previous created file, move terminate action after the "Create File" action, run flow again, check file created can be opened.
Remark : in your flow I can see two "Get content" actions, you should only have one. Remove the extra action and check you set the "File identifier" field with the correct ID. It should be the id dynamic content of the copied file from "copy file" action.
I think you messed up settings in one of those steps, if you can open created file, conversion should be functional.
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