According to the battery tips sticky, wifi apparently uses less power than 3g. I don't ever use wifi, but I would assume it is faster also.

 

I believe if wifi is enabled, it will try to connect to any known networks if you are in range. The phone will use mobile network if you are out of range of any of wifi.

 

It won't connect if it doesn't know the network, but if you tell it to save and always connect to a network (such as your home) it will.

You can set it to have an alert if there is an open unencrypted network. Such as in a coffee shop

 

Yup, this is correct. But I was unaware of the open network alert. That would be either pretty cool or really annoying depending on where you are

 

Maybe this thread will help !

http://androidforums.com/htc-droid-eris/25130-3g-vs-wi-fi.html

 

Yep, if you go to Menu > Settings > Wireless Controls > Wi-Fi Settings and select "Network notification: Notify me when an open network is available" It will give you a notice. If wifi is disabled, this won't work. So using the Wi-Fi widget somewhere can quickly turn it off temporarily if it gets annoying.