If you need Office compatibility, you might as well spend the extra money for Office. Pages doesn't even deal with .doc(x) files itself (it forces you to convert to Pages and export).
However, if you are simply creating documents and you can use PDFs to share, I personally prefer Pages (and use it exclusively).
Edit... Either way... get a trial of both and see how you get on!
This really. No point paying more for something you don't necessarily need.
As for which one is 'better' then that's Office 2011 by far, no contest.
Apples offerings are generally fine And may well suit you but are not in the same league as Office if you are serious about yer docs and spreadsheets.
Apple have discontinued the iWork trial since they moved everything to the App store. I've used both and decided Office was better for my needs.
I stand corrected
So do Apple not offer trials in the Mac App Store?
office is better that iworks but really for an extra 30 odd quid I think its worth getting just for the icloud support for ipad/iphones. There is rumors of an iworks 12, as they released and ilife 11.