I was thinking about distilling my own ethanol to run my bike on years ago, seems it can be done fairly easily and as long as you tune the vehicle for it should not have any problems, would have worked out somewhere around 20 cents per litre from memory, but its very volatile stuff and a 5oC change in temp could see the whole still blow - might be a bit messy in your average suburban back yard lol.
Interesting idea and I'm sure that it could be done but I think 20 cents per litre might be a bit off. The only reason EtOH is cheaper than petrol is the excise break (EtOH is effectively excise free; there's 38cpl + 10% GST on petrol). Add in the cost of whatever energy source you'd use to distill it + the capital cost of the fermentation vat and the still and see what it comes out at. Unless you
are growing the stuff as a farmer, producing the required volume might be an issue too, even for use in a motorbike.
You can get crap with any fuel, just depends on the servo. I think it's less likely with any of the EtOH fuels, at least from the big brands, because they are supposedly taking steps to ensure that the tanks aren't contaminated. If you get a bit of water in the bottom of a petrol tank (in the servo.) it doesn't matter much as long as the pick up is off the bottom of the tank and the fuel is not stirred up, so some water may be tolerated.
If GMH says it's OK to run E10, certainly on a VE that's designed to run any mix up to E85, that's good enough I think (see posts #3 and #4). I suspect there's little difference in materials between a flex fuel and non-felx fuel VE anyway. (I do use E10 with an occasional fill of 95 or 98.)