Time to get edumacated.

First off, may I commend your interest in the Toyota (not Honda) Prius. It's a very well-engineered car that's been a total joy to own.

As to the ecological impact of batteries, hybrid batteries use NiMH (Nickel-Metal Hydride) batteries. Unlike the batteries in many non-hybrid cars, these contain no heavy metals and are easily recycled. You might find more information here on Toyota's press release:
http://pressroom.toyota.com/photo_library/display_release.html?id=20040623

Toyota has been recycling NiMH batteries since 1998, with the introduction of the Rav4.

While the Prius does have a lead-acid accessory battery similar to non-hybrid vehicles, it is significantly smaller, since it does not do any of the heavy lifting associated with the engine. Also, recycling is available for lead-acid batteries. You might look here, such as on page 12:
http://techinfo.toyota.com/public/main/1stprius.pdf

As to whether hybrids are "more expensive than comparable cars": (prices from Honda's web site)

Honda Civic, non-hybrid: $18K base price depending on trim, 35mpg
Honda Civic, hybrid: $21K base price, 50mpg

So you're looking at about a $3K price difference. At $3 a gallon, you'd need to save 1,000 gallons of gas to make up the price increase to buy the hybrid version. Assume you drive 1200 miles a month (based on my personal driving habits):

Civic, non-hybrid: 34.25 gallons / month
Civic, hybrid: 24 gallons / month
Savings for hybrid: 10 gallons / month

So a very simple analysis shows that you would need to drive the hybrid for 100 months (8.3 years) AT CURRENT GAS PRICES. If gas gets cheaper, then you'll need to drive it longer (or more) to make back your money. If it gets more expensive, you need to drive it less to break even.

I went to the US Energy Information Agency's web site, and looked up historical gas prices.
http://www.eia.doe.gov/oil_gas/petroleum/data_publications/wrgp/mogas_history.html

Today's price of gas (all grades, across all US regions) is $2.61.
8 years ago (10/27/97), that price was $1.20.
So if gas doubles again in the next 8 years, you'll make your money back in more like 5-6 years.

However, there's more to consider. Toyota uses an eco-plastic in the body construction (plastic made from plants, rather than petroleum products). The battery is recyclable, as is much of the car (steel and aluminum body, for example). The Prius generates slightly more CO2 during its production than an unnamed (assumedly comparable) gasoline vehicle, but by 20,000 miles has more than made up for that difference by emitting less CO2 during its use. Everything past that is ecologically beneficial. Read the entire green report here:
http://www.toyota.co.jp/en/k_forum/tenji/pdf/pgr_e.pdf
(Note that you'll need to install japanese fonts for some reason, even though the report is written in english).

Congratulations on your consideration of a hybrid - best of luck!

Aaron
2005 Prius, red, 15000 miles, getting its oil changed and a tuneup today