Hi Peter,
I was facing the same problem as you. I found out this as a little workaround:
I don't open documents from Readdle's Documents anymore but directly from the dropbox or from the Word's or Excel's history. If you open the docs on the Ipad once (with anexisting internet connenction), you will still be able to open them offline. Office
for iPad keeps an offline copy in the cache. Office for iPad will sync them as soon a connention is available again.
I still use the Documents app to have an offline copy of the whole dropbox content though. But I only open docs directly from here, if I have never opend them before (so they' aren't in the cache from Word). Then of course I'm facing the same problem as
you do. And I have never understood why it should't be possible too open a document from 'Documents' without the read only status...
Please post a solution for this here, if you find one.
Kay