The island's infrastructure is adequate by Caribbean standards, but don't expect 4-lane motorways on our 37 square miles. In recent years the roads on the Dutch side have been dramatically improved. Most of St. Maarten/St. Martin's roads are paved and very few require a 4-wheel drive vehicle. You will find the major traffic arteries rather narrow and being overused by large trucks and tourist buses, resulting in frequent traffic jams.
Especially the Simpson Bay area with the road leading to the International Airport is subject to delays, as the draw bridge letting yachts into the lagoon opens frequently and backs up traffic.
The good news is the friendliness of local drivers, who don't insist on their right of way and let you cross a busy intersection without too much delay. The customary courtesy of St. Maarten/St. Martin's drivers shows that traffic can flow through complicated intersections without traffic lights and even regulations. The downside of this easy going attitude is the habit of local drivers to stop in the middle of the road to have a chat with a friend. Just don't get upset; after all, you are on vacation.
Some of the traffic rules are different from the ones in the US, as the island follows European traffic laws. The most important difference is that cars coming from the right have the 'right of way', if signs don't indicate otherwise.
Fuel prices are somewhat higher than in the US, but much lower than in Europe. The Dutch side gas stations post prices in Antillean Guilders ($1 = NAF1.80), the French side in Euro (exchange rate varies). Several stations are open 24/7.
There is no reason not to rent a car: rental rates are the lowest in the Caribbean and comparable with Florida. The island invites you to be explored, and with its small size you will be able to visit most sites of interest within a vacation week. Getting lost is just part of the experience in order to learn the lay of the land and will not result in delays of more than 15 minutes due to the geographical limits. Basically, the island has one major road looping around it, and another one running through the Lowlands. It is always easy to find your way back to the main road and to determine where you are.
Think twice if you really want to rent a Jeep or something similar; apparently the term 'Off road Vehicle' translates into 'Feels like being off-road', even if you are on a decently paved street. Experience shows that a regular small sedan with air condition is the most comfortable and practical choice on St. Maarten/St. Martin.