Ethanol has some advantages, but there are drawbacks as well. For one thing, ethanol is a pretty good solvent. It can cause sludge problems in older cars by partially dissolving the crud at the bottom of gas tanks. These problems are typically short lived - after a few tanks, the sludge is gone. But until that happens, you can have clogged fuel filters and other issues. Also, for some older vehicles, ethanol isn't compatable with seals. It can cause fuel leaks (I've experienced this one firsthand). It may not be an issue with newer cars.

Every winter, most of us in Colorado have to switch to oxygenated fuels to lower exhaust emissions. In the past, there were two additives used to oxygenate the gas, MTBE and ethanol. Today, it's mostly ethanol. Every year when we make the switchover, I find that my gas mileage drops up to 10%. While oxygenated fuels do good things to lower emissions of older cars*, modern cars have oxygen sensors in the exhaust system. When the sensor detects a higher oxygen content, it richens the mixture which increases fuel consumption and lowers acceleration.

*I've read that cars built in the 1960s and even the early 1970s had emissions levels about 400 times that of new cars. Lowering their emissions can have a big effect on reducing pollution, but decreasing gas mileage on all the new vehicles tends to increase their emissions. Perhaps we need a buy-back program to get those dirty old cars off the road. That might be more effective in the long run.