Here's the first place we're seeing Martin Campbell's Lantern split from the comic book canon. In the comics, Hammond is simply a petty criminal who stumbles on a meteor that all around it with superpowers. He promptly captures some scientists and exposes them to it, and sells all their amazing inventions as his own. Eventually, he became a big-headed superbeing who could enforce his will on others. In the film, Hammond will be a doctor. He's a a brilliant pathologist but seen as an utter failure by his senator father. He discovers a meteor that grants him psychic powers. I'm sure he'll turn those powers to profit, become corrupted, and catch the all-policing eye of Hal Jordan. Then he'll become obsessed with obtaining godlike powers just to defeat Hal Jordan. You can give a man a doctorate, but you can't take away his baser motivations, can you?
Few play brainy evil as well as Sarsgaard, so I think he's a great pick. He certainly adds some dramatic weight to the movie. But it still hinges on Sinestro because whoever they cast now has to outmenace Sarsgaard.