Hey there kattnip333,
Thanks for reaching out to Apple Support Communities. I understand you’re having issues accessing a password protected spreadsheet from iCloud. I’ll be happy to help.
With iCloud Drive and Files, you should be able to store and access your password protected file without issue. iCloud Drive is similar to a folder where you can place and access your files. You can read more about this in these links:
Access iCloud Drive files from your iPhone and other devices
What is iCloud Drive?
If the spreadsheet is a Numbers or similar type file, you should be able to use the steps here to help you lock and open the file:
Password-protect a Numbers spreadsheet on iPad
If you’re locking the file with Disk Utility or if it’s a PDF and you’re locking it with Preview, you may need to open the file from your Mac before it will work as those are macOS apps. Try locking the file using an app (like Numbers) that is accessible on both iPadOS, iOS, and macOS and see if this works.
Let me know if this helps.