No, over night is definitely not going to happen. I think one of the biggest problems with public transportation is politicians always try to line the pockets of their friends and themselves by going way over board.
One idea I had was to use the existing freeway system as a public bus route. The exit/entrances would be pick up/drop points. We do not need 4 gas stations on each corner. Use immanent domain (for a good cause fianlly) and shut down two of them (one each side) and tuen them in to parking lots. People can drive to the local parking spot, walk up the stairs to the bus stop on the freeway median, rid the bus to their closest stop and take a shuttle to work. Incentives could be given for companies to run shuttles too and from the stops. Smaller companies could pool their resources. It is not a perfect solution but it is definitely a start. I worked right off the freeway and live one mile off the freeway. I know I am not alone. Give me a clean safe bus to ride and I am on board. In the mean time, we can start building subways or light rail to make it even more convenient father down line.
We do not always need to go for the most advanced, all the bells and whistles solution. Sometimes basic works better.
As for diesel, I think it is another supply/demand issue. The more people who buy them, the more affordable it becomes. MB is expensive becasue MB is expensive, not necessarily the technology. I am sure the Honda's will not be that much more than a gaser and VW is getting better in terms of reliability. The Europeans are buying diesels by the droves. IIRC the numbers are somewhere near the 50% mark. I seriously doubt they are all buying POS. I drove a Opel Astra (the new Saturn Astra. It was a 5 cylinder diesel 6 speed (I do not remember if it was a turbo or not) and I was really impressed. I remember thinking that if it had a sunroof I would have stolen it and shipped it back to the states. I have never been a fan of US cars so for me to say I wanted an Opel says a lot. If the big three can do it for Europe, then can do it for the US. They just choose not to. Given that VW seems to have a hard time keeping the diesels on their lot for more than a few days, I do not think it is a consumer issue anymore.