Yes, space is hostile, but if you can bring as much gear as you want, it can be handled. We know how to make artificial gravity. We know how to make radiation shields. There is really nothing technologically holding us back other than the BIG issue of how expensive it is to get gear and equipment where we want it. I'm like a broken record in this regard, but I believe it will take some major breakthroughs to get us jump started with major a presence in space. It all starts with some exotic method to launch of which I think the space elevator is the most possible.

If we can make big advances in robotics to build up an automated infrastructure that can exploit space resources in low gravity wells (e.g. Moon, asteroids), that would be another avenue to obtain (raw) resources in space. The only other possibility is to once again use automation to make use of in situ resources to bootstrap a colony (e.g. mars?). This latter is obviously the most difficult because how do you get from raw resources to relative independence from mother earth technology and launches? Obviously that would be a long way off (self assembling nano factories?). Bottom line, true space expansion will only occur when we can do something profitable in space. Right now that is pretty much limited to communication satelites and earth resource analysis probes. The possibilities won't expand much until we have that inexpensive launch capability.