I don't know what the maximum length is. You might try the following:
- Select Tools | Options...
- Activate the General tab.
- Tick the check box "Confirm conversion at open".
- Click OK.
- Go back to step 3 in the Mail Merge task pane.
- Click the option to select another data source.
- Navigate to the data source file, select it and click Open.
- You'll be prompted for a method to connect to the data source.
- Try one of the other options than the default OLE DB.
- Proceed as usual.
I'd guess that the original field names in the data source contain spaces. In general, I would recommend against using spaces in field names (and to keep field names short).