Palm oil plantations are really bad for the environment - not that any Amurrikan would care, just so long as they can drive their SUV.
On the upside, diverting lipids to biodiesel instead of food will help out health-wise by cutting calories in food. (similar to the upside of ethanol from sugar) Reducing obesity saves energy used by healthcare. A prime example is savings on pharmoceuticals to treat obesity-caused illness like high blood pressure, diabetes, etc. Pharmoceuticals production creates a lot of waste products from the synthesis. Think of clandestine meth labs and hazmat teams to clean up the crime scene. Has anyone taken into account healthcare savings in the ERoEI of ethanol?
This is an upside if you reduce the calories from the diets of fat people who eat too much. Not so good if the calories are reduced from those diets who are already marginal.

In which regions are these oils produced? Whose diets and ecosystems is this ramped-up production going to affect?

These oils are produced in America.

Ramped up production will benefit the diets and the ecosystems of Americans.

Savvy?

Palm oil is not produced in America, Stryker, because oil palms are tropical plants, Arecaceaes. The African Oil Palm (Elaeis guineensis) is native to west Africa, occurring between Angola and Gambia, while the American Oil Palm (Elaeis oleifera) is native to tropical Central America and South America.  Freezing temperatures kill both dead.

Please do try to avoid being an overly enthusiastic and uninformed shill for every bio feedstock that comes down the pipe.

OK, you got me with being a bit Americano-centric with the upside post. In Brasil, the people are rather poor (except for the drivers) so diverting sugar could cause a problem. That's likely true in other sugarcane producing places. We Americans oversugar our foods with high-fructose corn syrup, so our diverting HFCS is a good thing. But Splenda needs sucrose from sugarcane as the feedstock. Fortunately, Splenda is 600 times sweeter than sugar, so diverting sugar to Splenda is a minimal load.

With palm oil, that comes from poor places too, so inadequate calories for food can be a problem there like Brasil. All in all, biofuel of all types hits a limit way before the quantity that allows driving SUVs on long-range commutes.

Better yet, don't make the fuel and let people walk.
Reducing obesity saves energy used by healthcare

We had better plan on turning off TV then if this reporting is correct:

http://www.monbiot.com/archives/2006/05/02/feeding-crime/

Highlights:
"Each hour increase in television viewing", it found, "was associated with an additional 167 kilocalories per day"

"Researchers in Finland found that all 68 of the violent offenders they tested during another study suffered from reactive hypoglycaemia: an abnormal tolerance of glucose caused by an excessive consumption of sugar, carbohydrates and stimulants such as caffeine(6)."

"The number of violent incidents caused by inmates in the control group (those taking the placebos) fell by 56%, and in the experimental group by 80%."