I use both extensively...
I mainly use iWork at home and when freelancing, since it really is an easier, more productive package to use. But I use Office for Mac 2008 at my day job for the higher liklihood of compatability with my clients who pretty much use Office exclusively.
IMHO, iWork is the better package for the average user. It is has lots more power features aimed at making things look great with little effort. It's a typical Apple product, well thought out and functional. Office, on the other hand, has more power features for the programmer or power user who is building intergrated applications. VBA and Access are powerful, but used by less than 5% of consumers. If you need a database, Bento (by Filemaker) is a MUCH better choice than Access for most anyway.
You can get a 30-day trial of Office for Mac. A good way to get a feel for iWork is to watch the tutorials on the Apple web site.