This is ridiculous!
I have now established that there are issues with Pages, Numbers and Keynote documents!!! They surely cannot all be corrupted?
I have managed to salvage an important Numbers Document which I have copied in to iTunes (and subsequently on to my external HD).
To try and rectify the situation I have then turned off iCloud on all 3 apps on both my iPhone 4 and iPad and deleted all documents under each app. I have then gone on to iWork under iCloud and deleted all documents off there (some of which I noted were not the up-to-date documents I had been working on in iOS). I had to turn off iCloud regardless to delete a couple of the documents on my iPhone (under all 3 apps) as some documents were greyed out (see original post) and could not be deleted. As soon as iCloud was disabled it enabled me to remove off the local device.
Having switched iCloud back on to my iPhone and iPad (and bearing in mind I had deleted all documents off both iOS devices and in iCloud) the greyed out thumbnails re-appear (and cannot be deleted or altered!!!!)