[Ashartus]

Use Freecycle and Kijiji as much as possible, along with garage sales and friends with babies older than yours, to get baby stuff cheap. For things like strollers, exersaucers, etc., you can probably buy them used and sell them for almost as much as you paid for them when you're done.

For diapers, cloth are not better for the environment than disposable. Life cycle studies have basically concluded that it's a trade-off; the water, energy and detergent use for cloth vs. landfill space for disposable. If you live in an area with plentiful water and limited space cloth diapers might win out so long as you use a washing service; in an area with limited water and lots of space (like here) then disposable win out. Cloth diapers that you wash yourself are by far the worst option environmentally. I'm not sure you'd really save any money on cloth overall once you factor in washing costs (not to mention the "gross" factor), especially if you buy diapers in bulk. Edit: even with 30-40 diapers that probably means washing a load every day or so at first; 15 to 20 diapers a day isn't uncommon at the newborn stage.

Don't buy a pile of newborn-sized clothes unless your baby is premature; they'll be too small in no time at all and you'll probably also get a bunch at the baby shower.