The problem about making unsound assumptions is that they often lead you to erroneous conclusions and make you come across as ignorant.
I use ethanol because it is pegged locally at $.50 less per gallon than unleaded. I get about 15-20% worse gas mileage with it than with unleaded depending on the type of driving I do. It makes economic sense to burn corn if the difference in price is greater than the loss of efficiency, which, of course, depends on the current price of gasoline.
As for the ethanol itself, it is produced in a local plant which is owned through a co-op of local farmers. They can subsidize the price to peg it below unleaded because the price of subsidization is offset by the greater price they receive from their corn. It is an example of local market forces working within the framework of the market as a whole. Farmers benefit through higher grain prices, and I benefit through the availability of a fuel source that is often cheaper than gasoline.
I don't think it is contributing to the problem, or being "trendy," to take advantage of market fluctuations in the price of energy because local farmers are hedging an energy investment against the price of corn. You should probably reserve your judgement for situations about which you actually know something.
EDIT: And no, I'm not particularly concerned about the conservation of energy.