I agree that NWE and InDesign still have a few issues – on which I've repeatedly harped in previous posts

– but until they are resolved (regardless of whether the responsibility lies with Nisus or Adobe) there are a few useful workarounds which I've found work reasonably well.
For the record: I typeset books, mostly novels, professionally for a number of publishers in Sweden. Some of these I've also translated. I use the same set of styles/formats in both programmes (which does mean that I have to reformat other people's files, yes, but that's something I've always had to do …).
In order to get the italics to "come along" into ID, try this. When the NWE file is ready to go, create a character style called for instance "Italic", select all the italics (in the way often described in this forum – so I won't do it again) and apply this character style to them. Even if the italics aren't imported into ID, the character style is, and can then be suitably defined as italic in ID.
Incidentally, in this way I can also circumvent NWE's lack of support for Small Caps. Create a character style callad, for example "Small Caps", apply it to everything that's supposed to be Small Caps, and define it accordingly once it's in ID.
There's some other formating that tends to come with the the placed NWE text, which shouldn't, and my workaround here is to simply find and replace each style with itself, and that usually takes care of it. Clunky, yes, and takes about ten minutes extra, once the text is in place, but it does make NWE a viable word processor for me and the work I'm doing.
Hope these tips can help somebody else, too.
Cheers,
Peder
PS Your colleague is running ID CS2 on a G3 iMac? I thought my G4 550 mHz PowerBook sagged under the load of CS, and now I'm sitting with a 24 inch, 2.33 gHz Intel iMac, waiting for CS3
