This is a very specific but annoying problem for which I've found a workaround (thanks to the smart folks in the training department at MASCO! ;> ).
A Little Background: Synchronize
So, you've got a mail merge doc. It's labels. You've set it up to Synchronize, so that when you make a change to the upper left address and click Synchronize, all other addresses take on the same updates. I.e. if you make the text blue, or insert a graphic, or whatever, you just make the change in one place and it updates all the others. This is a very nice feature.
Here's where you set synchronize. File > New > Labels, and in the Options tab select Synchronize contents.
A Little Background: Preview
As you can see above, you see the field names, not the field contents, in mail merge documents. To see the contents, press F4 to view your data sources. Expand the data source you're using, select the table you're using, click the blank gray box that's circled to select all the rows, and click the also-circled icon called Data to Fields.
Here's what it all looks like.
But! What Happens When You Preview, Then Synchronize???????
Let's say you've previewed so you can see the data .Then you think, "Hey, the font needs to be different, and I want it to be green." So you make that change to the upper left frame like normal, you click Synchronize....and you get this. All the content is the same.
Don't Worry: It's Easy to Fix
You just click that same Data to Fields icon. Select all the data just like before, click the Data to Fields icon again, and this refreshes the display and gives you back the normal content.