It sounds like the getKeywordVariations() API call can serve as the
source of your keyword variations:
http://www.google.com/apis/adwords/developer/KeywordToolService.html#getKeywordVariations
Actually parsing that data and writing it to a spreadsheet is specific
to whatever underlying language you are using. At the most basic you
should be able to output the data as comma- or tab-separated values
and import that into Excel.
Cheers,
-Jeff Posnick, AdWords API Team