Circuit analysis with a dependent current source
Your nodal equation is wrong if i'm understanding the directions you assumed for your loop currents.  If my figure below is correct, then your KCL should give,
$$i_1 + hi_1 = i_2$$
$$(h+1)i_1 - i_2 = 0$$

You can also try writing a single KVL equation around the entire perimeter - and recognize that the current going up through R2 is \$(h+1)I\$.