I am have black & white images in Photoshop sized as 300ppi jpegs.
Images were imported to MS Word file.
File was converted to PDF using Adobe Acroat Standard with conversion setting of Press Quality
Create Space says images are less than 300 dpi
What am I not doing correctly in this process?
Word to PDF conversions problematic. This is a worse with the PDF converter plug-in, and not so bad with Acrobat. But if you were using Acrobat to convert, and if you did not downsize inadvertently:
I would suspect, that you might have edited the images in Word (usually resizing). This can cause problem. To be as safe as possible, size the image outside Word to exactly what you need. Then insert them, do not drag and drop.
If you did all this, give more details.
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You must insert the images in Word (not paste) sized 100% at 300 ppi (i.e., do not resize or manipulate them within Word).
When printing/distilling with Acrobat, it's best to use the settings that CS recommends, rather than the Press Quality preset. Also, be sure your source images are saved as 8-bit grayscale, and that you've selected black-and-white output, not color (assuming this is a black-and-white interior).
Hope that helps. Good luck.