Sort of; you can’t manage iCloud storage the way you can other storage options, where you designate some folders/files to remain online and not be downloaded to the iPad, so it’s a little more challenging managing space that way. They will download when you use them, and then there’s no way to specifically move a file or folder back to the cloud to restore space on the local device. I believe that it can dynamically remove the local copies of files/folders, but it’s not quite as easy to manage as, say, Microsoft OneDrive is. (Is it still called OneDrive? I can’t remember)
However, the Files app on iOS is much better for using external storage; I have an Anker USB hub (I’m actually connected to an external monitor and Logitech keyboard/mouse right now just for S&Gs) and it works fine. I have used this hub to move video files onto my iPad while on plane trips, and it works great. There’s no reason you couldn’t use an SD card or portable HDD to increase your storage capacity this way; it just requires adopting the “dongle life”. I think it’s fine personally.