That's right FastFwd. The thing that bothers me about ethanol, especially right now, is that is made mostly from corn (at least here it is). Corn hit a ten-year high recently. High fructose corn syrup is in many of the foods we consume, and so it's going to raise food prices as demand for ethanol grows. I'm just unconvinced of the wisdom in burning food as fuel, but ethanol has powerful ag lobby behind it, so its going to happen.
With regard to the energy inefficiency of hydrogen extraction - if you build a wind farm and use the electricity produced to power electrolysis units, what difference does the inefficiency really make? The wind is free, and wasn't being used for anything else.