this is solely a personal opinion post. my way will not necssarily be right for you, but it's right for me.
when i was first pregnant, my husband and i discussed diapering solutions. i was totally opposed to going with mainstream disposables, so we decided to get cloth diapers. we spent time going to second hand shops and collecting diapers from friends with older kids. then we purchased a few prefolds in various sizes from a local retailer, and got our plastic pants from a local mega-store. i also used paper liners once the baby was started on solids to reduce the scraping necessary to remove feces.
i did some consulting with previous users, and determined how i was going to care for them. I decided to use a dry pail, and machine wash and dry them. i am not anal about stains, particularly as i lived on a farm with iron-rich water, so whites eventually grayed no matter what. and you know what, while not pristine white, they are a nice 'ivory' tone and don't LOOK stained, with few exceptions.
it worked wonderfully. with only a few extra loads of laundry a week, i was doing my part to reduce my carbon footprint. we hardly used any disposable diapers for baby #1
baby#2 has been a bit different, mostly due to circumstance. we've moved farther from our extended families, and therefore are on the road a lot, visiting. while it is possible to cloth diaper on the road, it requires a fair bit of extra effort, and extra space to pack.
i feel guilty every time i buy a package of disposables, but i think i can justify the use, because it's either that, or put my sanity just that wee bit closer to the edge.
that said, i still LOVE my prefold diapers, plastic pants and snapppis! i use them as much as i can, and will likely have diapered my 2 children for less than $500 including the disposables and training pants!
i'm always interested in others opinions and such though, so feel free to let me know what you do/did for Your kids!