Biofuels are not simple. There are issues about price, feed-stock, land-use and many more aspects. The World Land Trust sounds the alarm bell saying that the extended land-use can be harmful to biodiversity and even increase climate change.
Worldwatch Institute, in a new book "Biofuels for Transport" debates the potential and the implications it may have on agriculture and is more optimistic. They even come to the conclusion that the rising prices for feed-stock could benefit the poor countries economies who have suffered for a long time when rich countries have driven food prices low by subsidising their own farmers. Those most hurt by a change would be the urban population in the poor countries, but they would have little help from prices so low that they can not subsist local farming anyway. Other means for poverty alleviation are needed. It is indeed a tightrope walk they describe, but not impossible. It will however take some quite enlightened politicians to make it work!
On the technological note the Worldwatch also notes the long-term solutions are in feed-stock that does not compete with food-production like waste and cellulosic materials. And equally important that we are not only talking fuel-substitution but "a portfolio of options that includes dramatic improvements in vehicle fuel economy, investment in public transportation, and better urban planning"