Depends on what you are going to do with the foam. I used the large 8'x 2'x 1" foam boards from Wickes for my 14' x 6' wargames table. I needed straight edges and a hand-held hot wire is quite difficult to use to get a straight edge. In the end, I used a piece of 2' wood as a guide. It worked fairly well.
However, if you are going to use the foam for creating contours etc, the hot wire cutter is ideal. Using a knife just makes a mess and small pieces of foam keep turning up for weeks afterwards.
No problem with the fumes, as I did the cutting in the garage.