It's quite a quandry. With the nursery rhymes, change of eye color and personality, it seems that way sometimes. When doctor Arkham asked him about it, he said that he sometimes feels that there's someone else there, (Arkham specified it as a tiny scarecrow running around in his head), making him do things even when he doesn't want to. But most if his crimes (such as vengeance against those who'v harmed him and robbery to fund his research), seem to be something that he would be motivated by. I think he might have schizophrenia and sadistic personality disorder, but i'm unsure of split personality.

It depends on how he's written, but generally, I'd say Scarecrow isn't crazy at all. He knows what he's doing is wrong and evil – he simply doesn't care. His fascination with fear is more important to him than human lifes.

It's like what the psychiatrist that interveiwed him said in the Arkham asylum videogame, "I don't think he is truly insane; just evil"

I'm not very well educated on the subject, but I tend to latch onto one theory over another when it comes to Batman, such as Joker backstories (I favor The Red Hood). In this case, I watched a playthrough of Arkham Asylum before reading comics, so I'll have to agree with MasterOfFear, personally. "I don't think he is truly insane; just evil... It seems his research is the only motivating factor in his life."

That is little sad, having only one thing in life keeping you going.

It is a bit sad, but that's the thing with Batman. Most of everything is sad. I've never heard of any bad ending in Superman comics or some other such comic. Well, let me rephrase that. I've never heard of anything grey in continuities like the Superman world. Everything I've heard about is clearly set apart in good and evil, while in Batman, you can't just say "Well, they hate Batman, that's what's wrong with them."

But yes, it is rather sad.

Well it's debatable , some say he does have a split persona and some say he doesn't. I personally think he just gets exited when he has a chance to use his fear gas.