After googling for some time I came across another thread with a similar question:
http://help.lockergnome.com/office/W...ict992089.html

I checked the following option:


So I can only conclude that this type of text (grayed out - don't know the name) is not 'hidden text', but something else.

Just to clarify the grayed out text I am referring to is the text left in place after I place a drop down list/text box/date picker etc.

Thanks