Hey @farthingcomms, I've never done this before so I can't guarantee that your goal is entirely possible in Retool. That being said, it seems like it should be. We do have a REST API resource that you could connect to either Google Drive's API or OneDrive's API. Skimming through both, I personally would first try with Google Drive since I was easily able to find information suggesting that you will be able to convert HTML or plain text to a Google Doc.
Retool has a text area where you can reference Retool variables within {{ }} and write in Github flavored Markdown, plain text, or HTML. You could put your letter templates in a listview component or populate them with the data from a selected row of a table.
I hope that helps to get you started 