I like the overall philosophy of this idea

. I just looked at the picture - there are at least two different types of peanuts there.
I would flame-test anything being used on a boat with a match or candle. If it goes out when you take the flame away it's likely safe. If it continues to burn on its own I'd stay away from it, especialy if it'll be anywhere near electrical wiring. I would assume that the corn-starch type would be flame-safe, but of course inappropriate for this application.
I used this test when deciding what materials should supplement the insulation in the attic of my house, and ended up eliminating the majority of materials not specifically manufactured for that purpose. In fact, I found that some foam packing sheets would make great ( ie. scary-fast) fuses if cut into strips.
I don't have a sailboat yet, but I've been keeping (no I am not a "hoarder"

) large-mouth screw-lid jars (such as the large clear jars you get pretzels in) to possibly replace some of the floatation foam. I plan on putting some light, less often used, (ie. spare towels etc) and emergency items in them and sealing them up, giving them double-duty as floatation.
