I actually like Pages better from a "create from scratch" on the iPad standpoint. I save frequently to iWork.Com (1GB for free), and pick up on my Mac or PC. You can save in Word, PDF, or Pages format. Your documents live on the cloud.
All of these solutions suffer from the same basic problems of poor external keyboard support (I bought a bluetooth keyboard with my iPad, but I've ended up typing directly on the glass 90% of the time...). They also suffer from conversion issues with MS Word (as even Microsoft's "open" formats are so convoluted no one seems to be able to fully support them.) Printing, and File Management are also issues.
That said, I'v adapted my workflow. On the iPad, I take lots of notes, roughly compose the document, maybe do a little editing and revision in the evening on the sofa. I save right to the iWork.com cloud. For the final pass I'll grab the document from iWork on my desktop and give it a quick polish. Then I can tweak and edit again back on the iPad as needed.
I'm really hoping that iOS 4.2 (or what ever the operating system update for iPad is called) will fix some of these issues.
I'd like to see these 4 things in the Operating System update: (in order)
#1 External keyboard Arrow Key Support (reaching up to touch the screen to reposition the cursor in spreadsheets or documents is a pain...)
#2 A "rich text editing" control, so that all the third party apps can focus on their app, and the formatting/compatibility/etc instead of writing all the low level stuff like font sizes, bold, italic, and letter spacing from scratch. Really, they already have the code in iWorks for iPad. Make it part of the OS so other text handling apps can benefit from the fast, highly optimized text handling.
#3 Printing. Even a subset of print drivers (postscript?), or a "print to PDF" and spool to your Mac or PC via WiFi would be extremely useful. This should be part of the Operating System, not something each app should implement (or ignore) like they do now.
#4 Better file/folder management in the device. I don't expect the iPad to have a full Unix or PC type file system with rights, and symbolic links, and such... But it would be nice to at least support folders or a tag system for your work. Tagging things "Client X", "Client Y", "Personal" etc, would be a big step forward, especially for folks like me that use the iPad for work.
Let us know what you finally pick, and how you work with it.