I enjoyed Diana's post on the subject. And I agree with her conclusion:
Rather, as can be seen from Dr. Peikoff's remarks, the problem with "lifeboat ethics" is that the proposed scenarios are concocted so as to produce irresolvable conflicts between people. By various artificial constraints, they make life in society impossible. They preclude any rational solutions to the problem at hand. Is it then any wonder that the results are unseemly? Of course not.
The simple fact is that lifeboat scenarios do not reflect the most basic facts about human nature, namely our distinctively human methods of producing and trading the values required to sustain life. Consequently, moral principles cannot be applied to such scenarios, nor induced from them.