Hi C.,
Welcome to cloth diapering! Yes it will be cheaper in the long run. A little more work laundry-wise yes, but it's not that bad...and this coming from someone who hates laundry!:-)
I have two in diapers as well and I mostly use cloth diapers. I use a combination of pocket diapers (fuzzi bunz: www.fuzzibunz.com), fitted diapers with covers (Thirsties fitteds with thirsties covers: www.thirstiesbaby.com), and hybrid diapers that can be used with a cloth insert or a biodegradeable, flushable/disposable insert (gdiapers: www.gdiapers.com). My youngest (6 months) is fully cloth-diapered (he uses the pockets, fitteds, and gdiapers with cloth inserts), while my oldest (2 yrs) mostly uses the gdiaper with the disposable insert, so for her it's less laundry since you can reuse the gdiaper covers.
Anyhow like some of the previous posters have said, cloth diapering has come a long way! There are many options out there and they are not all messy/dirty like another person said. Many like the AIOs (All In Ones) are almost exactly the same convienence as disposables, although they are the more expensive option. Anyhow, I'd highly recommend doing some online searching about cloth diapering before you make any decisions. Read up on the pros/cons like I did. To help you out, visit some of the following cloth diapering sites for good info:
These sites have good basic cloth diapering info: http://www.pinstripesandpolkadots.com/basics.htm
http://www.diaperjungle.com/index.html
This site lists many of the online diaper shops sales and clearance postings (so you can find good deals):
http://www.diaperpin.com/home.asp
This site has some good video reviews of most of the major diaper brands out there: http://dirtydiaperlaundry.com/cloth-diaper-video-reviews/
There is also a really good online cloth diapering video tutorial that I direct anybody considering switching to cloth diapering. It's divided into 7 segments, but about 30 minutes long total. It's a good intro to what you'd need to know before getting into cloth diapering. It discusses the different types of diapers, the costs of each, how many you'll need, laundering, diapering accessories you may need/want, cloth-diapering terminology, etc. It's here if you have the time (I'd really recommend viewing this first before doing anything else): http://www.youtube.com/user/JaimeeGleisner#g/a
Finally, once you decide on what type of diaper you want to try, you can pick up a couple cheap on many sites (sales, etc.) or buy used (that's what I mostly did) from Craig's list, ebay, or a cloth-diapering forum called diaperswappers.com. You can also do diaper trials (places like Jillian's drawers www.jilliansdrawers.com do them) where there is a fee upfront, you test out the diapers, then keep and pay for only the ones you like and return the rest and get your money back. Or if you decide it isn't for you, you can return all of them and you're only out like $10. It's nice for those who just want to get their hands a little wet (excuse the pun!) to see if they can handle cloth diapering before making a larger investment into a cloth diaper stash. The nice thing about cloth-diapering vs disposables is that once you invest in a diaper stash, you're set for your child and any successive children. I plan on having more kids so my initial investment into cloth diapers will save me so much money over the next so many years.
Well good luck and I hope that helps! Happy researching!
M.