A few words about hydrogen:

The advantage is the increased energy density available from fuel cells allowing for longer ranges in vehicles. The energy density of batteries is about 40 times less than gasoline meaning the technology would have to advance DRASTICALLY to make electric only cars that are comparable in range and size. Notice I said 40 times less energy dense so no, slightly smaller cars won't cut it. This is why PHEV and better yet, the Chevy Volt concept hold such promise. Side note: even if the electricity comes from our grid (largely powered by fossil fuels) electric cars can save energy since they are ~3 times more efficient than ICEs.

I've been to quite a few energy seminars and symposiums dealing with hydrogen and the general feel is that generating, storing, transporting and using hydrogen is still in the basic research phase. Being in the research phase, it is NOWHERE NEAR ECONOMICAL and will not be for at least 15 years, more like 20. I'm convinced that the reason car companies trumpet the technology is that it gives them "green cred" while knowing they won't actually have to spend real money on PHEVs making a change. Oil companies are supportive because while they fear biofuels and hybrids can actually lower their sales in the next decade, they know hydrogen cars will not.