Thanks. I did, they suggested powering off completely and rebooting (never has worked). I've cleaned contacts. They were ready to replace the SmartKeyboard, but I didn't have original receipt on me. I did finally get through online support as well (this has been really tough the last 24 hours for some reason).
********Anyone who has this issue, it actually did work for me to go to Settings
General> Reset> Reset All Settings ***********
They had initially suggested this at the Genius Bar too to "clear all the Bluetooth and WiFi settings", but once I reminded them the SmartKeyboard wasn't Bluetooth or WiFi he said "Oh yeah, I was thinking of other types of keyboards."
Anyway I hope the Setting reset helps someone else out. It does clear all wallpaper, wifi passwords etc. so a bit of a pain but worth it to get my keyboard back- it's why I bought the Pro!