Used cooking oil is a nice, idealistic idea, BUT used cooking oil already has lots of other industrial uses, and those people aren't happy about you burning it (and therefore the price will go up and restaurants might not give it away free anymore). BUT lets assume that isn't a problem....even if ALL the used cooking oil was burned as fuel, it would only offset about 1 % of the US diesel consumption.
So, it's great if you can find free used cooking oil and burn it, but it's at best a very minor contribution to solving the peak oil problem.

By the way, cooking oil generally comes from growing crops (think of the vegetable oil, soybean oil canola oil, etc), so it's not really that much different from biodiesel/bioethanol produced the regular way from soy/corn. You're just doing some cooking with it (and then having to clean it up) before you burn it.