One thing that I have found is that you need to tell each section to renumber the footnotes. So, place your cursor in Section 1, Launch the Footnote and Endnote dialog box, change the Numbering to Restart each Section, and then apply.
Repeat the above steps for each section. Unfortunately, I have found that the apply to Whole Document has been unreliable in Word 2007. It's much better in 2010.
Dawn Bleuel
Word MVP