Hi J.,
We don't quite fit your question, as we have been using cloth from the start, but I thought I might add my two cents anyhow. We love using cloth--you do have to be up for doing an extra load of laundry 2-3 times per week, but I've found the time investment to be pretty small. (I don't mind doing laundry, though.)
A site you might find useful is www.diaperpin.com. The site has user reviews of all sorts of cloth diapers and accessories. It also has a For Sale or Trade board on its forum (you might have to hunt around a bit to find it, but it's there). You can often get really good deals on used diapers there--a good substitute for eBay, which might still be refusing to post sales of used dipes. You can sometimes find used dipes on craigslist, too.
Another really useful site is http://www.diapersafari.com/diaperinfo/clothdiaperinfo/ --here, you'll find ideas about how many dipes of each type you'd need for a variety of approaches to cloth diapering (using mostly all-in-ones, mostly prefolds, or an in-between option).
I think that you are correct that it would probably save you money to use cloth with your 2nd and 3rd kids. If you go for prefolds, the dipes will be pretty inexpensive to start, and if you go for fancier dipes (all-in-ones, pocket dipes, or even fitteds), you could probably resell them on diaperpin.com or craigslist when you're done. To get more specific, check out the cost comparison for the first year on that Diaper Safari link I noted above.
As for the environmental question, at least one major research study on the topic did not take into account the landfill contribution of disposables when comparing disposables and cloth! (They also neglected to consider that you can use cloth for more than one baby.) Since that study found that the two were pretty equivalent, NOT counting the landfill waste, it actually provides evidence that cloth is better environmentally. Though if you use a diaper service, the environmental benefit is less clear.
Good luck with your decision! And if you do decide to try cloth, make sure your hubby is up for giving it a few weeks' trial run, at least. It can take a little bit to get used to the new routine.