Great! Thanks. I now see that git also has a built-in --color-words option, and I've added that to my notes. (I don't have a git setup to quickly try whether that would still work in conjunction with an external diff tool like oodiff though.)

In the mean time I'm using my (trivial) cwdiff wrapper in place of diff in tools that don't have a built-in option. I think it could be called from the oodiff utility here, where it would work equally well with any versioning system.