Why don't images in iCloud appear as available in iMovie on IOS?
I checked on my iMovie and it seams like you can only import video from iCloud Drive and the tab you are in will only accept video files, that's why the image file is greyed out.

To use that image in you iMovie project I recommend that you save the image to your local Camera Roll from iCloud Drive and then import it to iMovie.

You can save the image file to your Camera Roll from iCloud Drive with a application that allow you to manage your iCloud Drive. I use "Documents" by Reedle (it's free on the AppStore).