Pharyngula has good repost on the issue of whether corn-based ethanol can solve our oil-dependence woes. Short answer: no. Slightly-longer answer: peer reviewed studies suggest it takes more energy to produce ethanol than the energy that ethanol itself produces - in other words, the amount of oil needed to produce ethanol exceeds the energy value of the ethanol produced. Even if that's too pessimistic, the amount of plausible surplus energy is way too low to be a substantial fix for oil-dependence.
Instead the whole ethanol issue is being driven by powerful farm-state politicians and the Iowa presidential primary for both political parties. This might be one of the few examples of Democrats matching Republicans in a war on science.