Is Hydrogen better for the Environment?

It has been suggested that hydrogen is better for the environment but not necessarily better for fuel economy. That is because the majority of hydrogen is produced directly from hydrocarbons and has serious consequences - just as we currently have now by burning hydrocarbons (oil derivatives) directly in our vehicles.
A home made hydrolysis system can be constructed cheaply that produces a small quantity of hydrogen/oxygen from water and the resulting gasses passed directly into the intake air manifold of your car which is said to improve your fuel economy, but research suggests the engine may run hotter and timing issues will cause knocking.

Should we change over to an hydrogen economy?

Yes as should the whole world over, but with the reservation that storage of hydrogen is not the answer, actually it is futile and dangerous to even consider it see here:
http://knol.google.com/k/christopher-martin-wilson/hydrogen-storage-is-not-the-answer-to-a/41kg49i9tztg/4

Apart from some on-site hydrogen generation/insitu, the hydrogen economy is best directed and steered towards self sufficiency. In other words it will be a do-it-yourself proposal but unfortunately until we all switch over from hydrocarbons the oil companies will do everything in their power to prevent it which will ultimately lead to higher and higher oil prices for those few remaining willing or having to buy it from them.