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It can never work, the energy needed to make it is more then energy available from the H. It's like needing 1 barrel of oil to make 3/4 of a barrel of oil.
I'd say this is the least problematic aspect of all. If it was a viable energy storage solution, then it'd work even with higher energy input.
If that energy came from renewables then it could have some uses (wherever nothing but hydrogen will do), but yeah.
The case with transit is such that they keep trying to invent ways not to use trains, and we just have to tap our feet and wait for them to look facts in the face.
I guess you never been to the Alberta tar sands, that's exactly what they do with gas and water to make oil.