A letter in the South London Press from somebody who was there recalls: 'The closing down of the Woolworths stores brought horrific memories back to me of the Woolworths store at New Cross Road, Deptford, which was packed with hundreds of Christmas shoppers in 1944 and received a direct hit [by V2 rocket]. A friend and I were at the scene within minutes. We gave an estimate of 800 people killed in the area. Bodies were put in Vestry Vans (dustcarts) by the score throughout the day. The government disguised the number to 170 to keep up people’s morale'.
It is undoubtedly true that during the war the government did disguise the extent of casualties in incidents like this, but it seems unlikely that the truth could be obscured for long after the war, and the 168 figure is supported by a list of those who died printed in 'Rations and Rubble: remembering Woolworths - the New Cross V2 Disaster, Saturday 25th November 1944' by Jess Steele (Deptford Forum, 1994). Still it's interesting that the story of many more dead has survived as urban folklore.
Another piece of folklore connected with this is the suggestion that the Woolworths that was rebuilt after the war (it reopened in 1960) was thought to be haunted and that a number of staff refused to work there as a result. The only source for this was an interesting site on Woolworths history that seems to have disappeared along with the company.
The Londonist has recently mapped all the V2 rocket sites in London.