Hi Aleeve, sorry to keep you waiting.
The data is actually in the data chart and it appears as a spreadsheet format when I double-click on the data chart (note that it's NOT the excel spreadsheet format where you can see the spreadsheet tabs below).
In the Insert Chart function - all the information are entered via excel (although I don't have to manually open excel application). For example, in ppt2007, when i insert any type of chart, excel application will start next to ppt2007, which in this case, ppt2007 will be on the left, and excel2007 on the right - both will occupy same amount of space. See the image attached here.

Also, I think the ppt2007 is really a standalone function, and there's certain restrictions on compatibility - it's not fully compatible yet!
When I save in compatibility format, the "Compatibility Checker" dialog box (as your attached above) will appear. That's where they report all the problems that are not compatible with earlier ppt (ie. 97 - 2003).
I tried formatting the border but it takes time, and this will just be another band-aid, there's no permanent cure. In other words, whenever I creat in ppt2007 and save in compatibility format (for ppt97-2003), my end users will always have same problems associated with it.
I think with all these processes and programming from Microsoft, it's quite apparent that converting from ppt2007 to 2003 will pose a situation. No?
Next, I have also tried inserting data and creating chart inside excel, and pasting it (the data chart) onto ppt2007, saving it as compatible ppt2003. My end user gets a picture format which can't be formatted.
Any bang bang ideas that we can try?
Thanks again for your kind help. ;)