Jesse,
How many miles are on your Insight, and does Honda Canada give the same 150,000 mile (~240,000 km), 10 year battery warranty that we enjoy here in the States?
Also, if you have looked at Mike Dabrowski's site (99mpg.com) and If you are looking for a way to supress use of the battery, MIMA allows you to control your battery usage fully from all out, to no use at all. And then you still have the pack for use in emergencies and to start the car. I don't think pulling the battery out is a viable option unless significant modifications were made since the car has no alternator to charge the 12v battery.
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My questions are: Is there any way lithium ion batteries could replace my nickel cadmium ones?
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By the way, the Insight has Nickel-Metal Hydride batteries, better in some respects to Ni-Cd in case that affects your concerns about the battery pack at all.