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Dogs Rule on 10 July 2008
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I just did quick research on that, Kasz, and you are at least partially right to be concerned.

Ethanol is more corrosive then gasoline, so when a fuel system is made with parts that can rust or dissolve, then there is a real problem. For example, it will eventually put a hole in fiberglass fuel tanks that boats use( http://green.savvy-cafe.com/boat-engines-the-ethanol-menace-2007-08-10/ ) .

Here is what about.com has to say about 10% ethanol blends:
http://autorepair.about.com/library/faqs/bl412i.htm

A. A 10% blend of ethanol and gasoline will not harm any engine or fuel system component. However, the ethanol has a cleaning effect that will remove rust and other junk from the fuel system. This necessitates frequent fuel filter changes until the fuel system is cleaned out.

No modifications need to be done to allow an engine to run on a 10% blend of ethanol and gasoline. There is, in some areas, an 85% blend of ethanol and gasoline that does require engine modifications.

Actually there is no rubber used in the fuel system. All the fuel lines are made of Neoprene which is impervious to degradation by gasoline or other additives.

So at least when blended with gasoline, it has a cleaning effect. Why would it therefore produce gunk when it is a 100% fuel? As long as the engine and its fuel system is specially designed to take advantage of it (ie having a high compression ratio and no corrosive or alcohol dissolving parts) then it should be cleaner.

In the event that it does produce gunk that needs to be cleaned out by a mechanic say at the same rate as an oil change, I'd rather pay 50¢ per liter of (cellulose) ethanol + a mechanics labor for cleaning every 5000 KM then 1.45$ per liter for gasoline that only requires an oil change every 5000KM.

I'd even take that deal if it was 1.25$ per liter of pure(cellulose) ethanol. Why? Because the money I spend mostly stays local. I'd support the local producer, local farmer, local mechanic, local retailer, etc instead of the foreign oil company, local refiner, local retailer local mechanic, etc. (Most people don't have a local refiner though)