Yes, you can "preview" Word documents in Mail or DropBox and then use the "Open in" command (upper right corner; box with arrow) to open in Pages to save or edit. Not all apps will be available to "Open in" but Pages has very good integration from Mail and from DropBox. (Whereas I can't open a Word document from DropBox in Writings but I could, of course, copy the text of the Word document in DropBox and then create a document with that text in Writings.)
The focus on apps necessary in the iPad IOS can be frustrating at first, but my advice is just to get a few apps and start working. Then you can tune your approach to what works best for you. I'd invest in Pages and also get the free DropBox app and play around. The reason most of what I do revolves around DropBox is because that provides constant syncing of documents in my DropBox folder between my iPad and my MacBook Pro.
I also read, and annotate, a lot of PDFs (again storing and syncing via a folder in DropBox) and there are lots of PDF readers out there, including the built in iBooks. I prefer PDF Expert because of its clean interface and robust annotation features, but GoodReader also has lots of fans.
In the 3+ months I've had my iPad, I've gone from being joined at the hip to my MacBook Pro to doing a large portion of my work on my iPad.
If you do plan on writing more than a short comment or email on your iPad, I'd also invest in an Apple Wireless keyboard. It's lightweight and portable and will increase your productivity.