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My understanding is that the reason the Model T ran on gasoline, not ethanol was politics: while Prohibiton wasn't enacted until 1919, the movent was afoot in 1903, and "fuel ethanol" proponents were seen as aligned with the "wets." Unwilling to forsake the "drys" as customers, Henry Ford went with petroleum.
While I don't believe in the wisdom of "growing" a primary source of fuel, I think using it as an oxygenate is a heckuva lot better than MTBE. I also don't buy the Pimental argument about "energy-negative," because no-one other than Prof. Pimental has come to that conclusion.
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