jl777, if the originator signed the root hash of the Merkel tree when he provided it to the intermediary, then the intermediary can prove that any fragment(s) of the document was signed by the originator. The originator is the one who breaks the document up into words or characters at the leaves. A Merkel tree is a very efficient structure space wise if the granularity is very high.
I suppose yours of deterministic mapping each hash to a field element and multiplying all together (and the originator signs the product) is more space efficient, but it is I think roughly an order-of-magnitude slower. Why not add instead of multiply since adding is much faster (one assumes hashes are difficult to preimage)?
Correction: the Merkel tree is also more space efficient (as well as being faster), because the intermediary doesn't specify the hashes for all the leaves when writing a proof.