I haven't heard of Mars Direct, but from reading the link you gave me it sounds like a plan to start automated fuel production plants on mars to make fuel for trips back to earth. It requires the transportation of a small nuclear power-plant to mars as well as hydrogen to synthesize methane from the carbon dioxide already in the atmosphere. Off the bat I would say that hydrogen would be a pain to transport to mars (hydrogen has a high energy density by weight but not by volume) but don't know much else to think about the project.
Electrolyzing water would also give hydrogen which would make the transpiration of materials easier. I’m guessing that it would require a large amount of electricity to get enough hydrogen/oxygen from the water (they really would need a miniature nuclear reactor).
Edit: for my last comment (which I can’t edit now) I meant to say that hydrogen has a high energy content by mass but not by volume. So 1kg of the stuff has a huge amount of energy but also takes up a lot of physical space.
