There seem to be two trains of thoughts about cloth diapers. Either people love love love em', (because they're cuter, better for the environment, contain less chemicals, and are cheaper,) or they hate em, (because they are more work, and are potentially yuckier). I'm sort of middle of the road on the issue. It's all true (although the cons are not as bad as people think).
Wanna know why I bother? Because it's cheaper. A lot cheaper. If you wanted to go the uber cheap prefolds and covers route, you could diaper your kid from birth to potty training for the same amount of money it would take to buy Huggies for a couple of months. And then you could pass them on to the next baby. Most people don't stick to just prefolds and cheap covers, but you could if you needed or wanted to.
Cloth wipes are huge money savers too. (Especially if you just use baby washcloths.)
As for the extra work aspect, cloth diapers account for 2 or 3 extra loads of laundry a week here. It's a little gross to have to put the diapers into the front loader with my bare hands, but it's not that big of a deal. You could wear gloves if you wanted. Before I had the front loader, I just dumped the pail into the washer.
The diaper pail is stinky, but not any worse than a trashcan full of sposies.
The yucky factor is as follows.: They really aren't any yuckier than disposables, until the baby starts eating solids. At that point, a $30 diaper sprayer is a majorly worthwhile investment. It will allow you to easily clean off the er...solid matter without having to actually touch it.
You can also cloth diaper part time, which is something I don't hear many people talk about, but it's what we do when things get hectic. If you only use half as many disposable diapers, you're still saving a ton of money, and a lot of trash out of the landfill.
If you've been thinking about it, but haven't taken the plunge, I encourage you to figure up how much you are spending on diapers and wipes every month. You might decide there is something you'd rather be doing with that money.
Cloth diapers. They work for me. Because I'm cheap.
Wanna find lots of other frugal tips? Check out this weeks WFMW at http://www.wearethatfamily.com/2009/05/wfmw-frugal-edition.html .