The debate between custom form and Word form is quite common. Both are correct depending on desired use. However, custom forms in system design should be used more often for reportable fields that do not change over time. For example, the key reporting fields project name, short description, sponsor name, project owner name, desired deliver date, and some key other fields would want to always be available directly instead of being in an attached file. Information fields supporting justifications, historical reasoning, proposed team members, and other non-reporting fields would be better in an attachment.
In practice, both should be used. Review the Workfront fields for what is available on the project. These include project owner, project sponsor, rough budget, planned dates off the task plan, planned hours estimate off the task plan, and others. Custom fields like fiscal year, fiscal quarter, funding sources, general ledger codes, and others are added for summary reporting needs. The word document then gets these fields and others that have been exemplified in many Internet examples. It is important to delineate the custom form fields will be those that rarely change for essential reporting while the document fields may vary over time.
I love this topic when looking over how many project management teams work to solve this common usage debate. Doug Williams