Why does "start winword" work but just "winword" doesn't?

The App Paths key is evaluated just after PATH if I'm not mistaken:

Windows Registry Editor Version 5.00

[HKEY_LOCAL_MACHINE\SOFTWARE\Microsoft\Windows\CurrentVersion\App Paths\Winword.exe]
@="C:\\PROGRA~2\\MICROS~1\\Office14\\WINWORD.EXE"
"Path"="C:\\Program Files (x86)\\Microsoft Office\\Office14\\"
"useURL"="1"
"SaveURL"="1"

That's how both the Start command and the Run dialog recognise Winword.exe as a valid alias. For more, read How is it possible to run Wordpad by just typing its name even though it isn't on the PATH? by Raymond Chen.

It's just not the start, but also the "Run dialog". The secret?

HKEY_LOCAL_MACHINE\SOFTWARE\Microsoft\Windows\CurrentVersion\App Paths

Run dialog and start checks here too. The command line doesn't.