If my name was bill smith and I registered smith.co.uk as a domain, would I be able to use email@example.com as my e-mail address, and would my wife be able to use firstname.lastname@example.org. Hope I don't sound thick.
with a decent hosting company you'll get at least one POP3 mailbox included in the deal. You can then put anything you like in front of the @ symbol - it will all go into the same mailbox.
If you want to use bill@ and sue@ as separate addresses you'll need to add another mailbox specifically for sue - so you both get only the mail that's specifically addressed to you.
If the hosting company only provides a single mailbox in your package you'll need to pay for the second one. It won't break the bank - most companies charge somewhere in the region of £12 per extra box.