Hi Pete, this is a new one on me, but what are the Sleep setting for the Display/brightness?
One way to test is to Safe Boot from the HD, (holding Shift key down at bootup), run Disk Utility in Applications>Utilities, then highlight your drive, click on Repair Permissions, Test for problem in Safe Mode...
PS. Safe boot may stay on the gray radian for a long time, let it go, it's trying to repair the Hard Drive
Reboot, test again.
If it only does it in Regular Boot, then it could be some hardware problem like Video card, (Quartz is turned off in Safe Mode), or Airport, or some USB or Firewire device, or 3rd party add-on, Check System Preferences>Accounts>Login Items window to see if it or something relevant is listed.
Check the System Preferences>Other Row, for 3rd party Pref Panes.
I may not have explained my dilema well. The area that gets gray is the title strip at the top of the top most application's window. The rest of the screen is just fine. If I need to click on a check box I have to click twice - once to "rectivate" the application and a second time to actualy click in the box. If I am typing a sentence or two if the window decides to deactivate I get a series of beeps as I keep typing and I then have click in the window with the arrow to re-actvate the window.
I hope this all makes sense.