complicate tax status! please advice

We got green card in March08. Before GC, my LD was H1B still under tax treaty. He got 1042s(for non-resident) for first 3 months. I was H1B(resident). We file separately last year. For this year, as i understand, he is on dual-status in 08, we have to file separately. or he has to give up non-resident treaty to fill with me. expert, Please advice! (PS. we have a baby and my parents were with us last year.)