A detailed explanation is
here.
Goodreader stores its PDFs in a "Documents" directory ("folder" in modern speak). I know this because I use Iphone Explorer, not Itunes, to put stuff directly in there, using drag/drop, and IE shows the app's directory structure (or at least the relevant part of it). Also I know that if one then does an Itunes sync, the whole damn lot gets copied to the PC... so those docs are probably safe.
Apple are going to have to fix this really fast. It basically affects just about every "serious" user. Speaks volumes about what they think their real customer base is
