Only a part of Siri which is something called "Siri Dictation". This feature allows you to dictate what you want to say instead of typing. You'll see new button on a keyboard.
I've been using this feature on my iPhone 4s since it came out, and it works quite well. There is a book on using Siri available in the iBookstore and it covers this feature quite well. It is amazing what you can do with it.
It will work in any app that you see the Siri microphone just to the left of the space bar.
No one doesn't understand it. But it's nice and simple to say "iPad 3" to distinguish it. It's the iPad (3rd generation) on Apple's website, so iPad 3 seems fine to me.