The body looks for carbs first. Once it's depleted the carb storage, it then goes to fat metabolism. The important thing to remember is that with those low carb diets, when there is a lack of carbs, fat metabolism cannot easily take place, so instead of going to fat metabolism, the body will begin to break down muscle instead. So make sure you have enough complex carbs so that your dieting will actually be worth something!
Once you consumre fat and everything is broken down that you're using, the rest is stored as fat. That doesn't mean that it all goes to the gut- fat is used by the body also as an insulating layer, to protect the vital organs like the kidney and liver, and is also used to generate heat (for instance). Fat soluble vitamins also need fat to dissolve in. So don't just cut out ALL the fat in your diet either. Instead, just limit your fat intake, and try to aim for the good fats- polyunsaturated and unsaturated fats. Cut out as much saturated fats, and cut out all trans fat.
Blood flow to the legs and feet... I don't know about that, honestly. I'd defer to Cbhungry to see what she might think on the matter. I don't think it has to do with the amount of fat you consume, though.
Sorry so short- I'm out of town and computer access is scarce. I'm sure others will chime in and help out here.