Woodgate has been released from Tottenham, while Smith is considering his options at Newcastle United.
Grayson said: "Jonathan has not played too much football and Alan missed quite a bit of last season. If you had a fit Jonathan Woodgate and a fit Alan Smith then you would have a host of clubs queuing up for them in the Premier League.
"The one thing we have got going for us is that they know the club and our ambition. That could help us if we go down that line but there is a long way to go before we even start considering it.
"We are interested in good players but that doesn't mean those two will necessarily be signing for us. I have got many irons in the fire.
"I am a long way down the line with those other players at this moment in time."