[Thingol]

Gandalf had not revealed his true power because he was unable to. It was only after he was sent back by Iluvatar that the restrictions on the amount of force he could use were removed.

At the moment I will only say that I was held captive. You? cried Frodo. Yes, I, Gandalf the Grey, said the wizard solemnly. There are many powers in the world, for good or for evil. Some are greater than I am. Against some I have not yet been measured. But my time is coming.

That may not prove to be one of the lighter matters said I. He laughed at me, for my words were empty, and he knew it.

Gandalf would not have willingly allowed himself to remain captive if he was more powerful than Saruman. It was not until after his duel with the Balrog that Gandalf became more powerful than Saruman. We will never know whether or not Gandalf was more powerful in the beginning of time as Olórin than Saruman in the beginning as Curumo, but we defiantly know that after the Istari were incarnated and forbidden to use their full strength that Saruman was the most powerful of the Istari. Just because Galadriel wanted Gandalf to lead the White Council does not mean that he was the most powerful of the Istari. Whether or not the limitations imposed on Istari were completely voluntary is another question alltogether. However, when Iluvatar sends Gandalf back to Middle Earth it is my opinion that He does not actually enhance Gandalf's powers, He merely removes some of the restrictions that were placed on him. Once Gandalf gets the "power up" from Iluvatar he becomes stronger than Saruman.