Ethanol is "environment friendly" when compared to gasoline, the latter having no good environmental aspects making it a bit of a low standard to beat.
The fact that rain forests are destroyed for corn plantations is probably independent of ethanol consumption, the ethanol driven investment mostly just increasing the existing rate at which deforestation happens. Corn is not only used for ethanol after all.
We can argue right and left here. Fact is, that there are multiple studies (somebody also cited some here) come to the result that ethanol when every effect is taken into account is worse than mineral oil for the environment -- and who says different, is most likely paid by the ethanol lobbies.
And to your "rain forests are destroyed anyway"-argument: You argue without any proof just by guessing. (BTW: rain forests where only one example, in fact, I don't know what areas are destroyed by fuel plants, but fact is, that there are areas destroyed and they are mono-cultures that grossly harm nature).
The fact that rain forests are destroyed for corn plantations is probably independent of ethanol consumption, the ethanol driven investment mostly just increasing the existing rate at which deforestation happens. Corn is not only used for ethanol after all.