There's an interesting article on prefabricated (modular) housing in the Fall/Winter 2007 issue of New Home (Better Homes & Gardens Special Interest Publication). These homes are quick and easy to build, though the photos and illustrations with the article were boxy. The editorial says that "Because they are built to the same housing codes applied to any new development, [they] are strong, and their systems reliable. Most are energy-efficient and made with sustainable materials."
The magazine also showcases a new book, Prefabulous: The House of Your Dreams Delivered Fresh from the Factory, and interviews the author, Sheri Koones. She points out that with factory construction, there's less waste. They can use drywall pieces, etc. on another job. Excellent point. I've seen the wastage on site built homes.
Closing Thought, at the end of the magazine, shows the original prefab homes--Sears kit homes (1908-1940) and Lustrons (1949-1950), which I'd never heard of, though hundreds of them are still in use. They were made from steel with a porcelain-enamel finish.