why do you think ion engines are extremly unfiednly for enviroment? you can use oxygen from air as propellant and you than only need very powerful enegy source.
Toxicity, of course, depends on propellant used. Considering the propellants available on Earth, most effective among technically simple to use will be mercury, which is highly toxic. Especially mercury oxides created when exhaust will be mixed with air, they are much more toxic than mercury itself.
Of course, you can live with xenon, as modern ion engines do, but at cost of bigger fuel tanks, cryogenic system onboard and specially designed ionizer for the gas.
Oxygen is generaly a bad idea -- its atomic mass is way too small. You want a propellant with high atomic mass to have an effective ion jet propulsion. The heavier ejected ion is, the more specific impulse is (impulse gained by ejecting the same mass of propellant) for the same engine design.