Biodiesal is already a thing. Also, we (the US) already blend a portion (about 10%) of corn-derived ethanol to our gasoline. There are problems with it though, one of which is that overall, it probably has a higher carbon footprint (fertilizer, harvesting, processing, etc.) than just not using it.
If you are disposing of the corn anyway, why not turn it into Ethanol and then burn it as car fuel?
The only real issue with Ethanol IMO is that corn Ethanol is preventing progress in advanced synthesis made out of, ex: switchgrass cellulose. There are better sources of ethanol if we invest into them.
The carbon footprint thing doesn't past review of the overall literature. There's one outspoken guy who has to bend over backwards and publishes media articles rather than keeping things academic who tries to make the public believe what you say, but I'm not convinced he's arguing in any serious manner.
They are used for all sorts of things we eat, corn nuts, hominy, grits, corn meal/flour and all the things those are used in. Personally, I find it far more palatable than sweet corn and it is far more useful/versitile/nutritious than sweet corn; it is a traditional cereal grain and can be used for all those things we use wheat and rye for.
There are many varietals of rice. Most do not grow in marsh land. Farmers often do flood the fields at the beginning of a rice growing season in order to drown out any competing plants. Flooding is not necessary though. Rice will grow with normal irrigation.
Yes. Rice tolerated flooding better than weeds so it is used as a cheap and easy weed control. Also some places grow fish alongside rice in the same land, getting some extra pest control and fertilizer for free.