I'm guessing that would be its main purpose. It's universal, so maybe Apple is assuming most (sane) people would do actual building/layout on their larger iPads. But, in a pinch, a quick tweak or edit could be performed from the iPhone (which is something most people would have with them at all times...iPad, no so much?).
I don't know.
I still think that cloud/syncing stuff will factor in heavily to all this, where you create an iWork document and it's automatically thrown up somewhere, instantly and easily available to you, from your other devices. I suppose they just wanted to get these apps down to the iPhone and iPod touch so it feels more like a "whole solution", where nothing is left out. If you have a Mac or an iOS device of any kind, plus this iCloud stuff, you can now create and edit these iWork projects anytime, from anywhere, etc. There could be some value in that.
I'm sure you could do the initial creating on the iPhone and iPod touch (why not?), but I can't see droves of people doing it with ongoing regularity (that's hardly the most comfortable, efficient approach). I think it's mostly there for convenience and last-minute "crap, I didn't bring my iPad!" tweaks.
It'll probably all make a lot more sense, come next week and the keynote. With Jobs being involved, you automatically know a) they're considering it all a "big deal" and deserving of his presence and involvement, and b) he's going to have the RDF cranked to the max to make it all look cooler and more enticing than we can possibly imagine right now. They're almost always a full 2-3 steps ahead of us, and most of what we're expecting/predicting now is probably just scratching the surface.
Hardware or not, I'm thinking next week's keynote - even if the sole focus is Lion/iOS 5/iCloud - will be quite a thing. As much as I love Apple hardware (who doesn't?), the truth is it's the software and OS that make it what it is. Always has been. So a keynote like this has the potential to be way more interesting and exciting, long-term, than new Thunderbolt-equipped Mac minis or whatever. Our iPhones and iPads are about to get a lot more useful and cooler, as are our Macs...without having to spend a dime on new hardware. That, to me, is good, exciting stuff!
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