And you know someone that actually fueled their jack-o-lantern that way....or did you read it somewhere?
Heard it from a history professor. The Druids are the ones responsible.
I wonder how he knew?
The sources we have on the Druids are very limited, mostly the Romans, who had an axe to grind after all. Much of what we "know" about the Druids was invented out of whole cloth by a fellow named Stukely who made a good living in the 18th century telling everybody what they wanted to hear.
The first book of the Oxford History of England series very kindly gathers all the threads together for you. And there is nothing in there regarding jack-o-lanterns (which are called "punkies" in Britain although they are usually made out of turnips) being fueled with human fat. Seems fairly preposterous to me anyhow . . . think of all the human sacrifices you would need to make given how poorly nourished folks were in those days . . . like the old joke "Do you know how many lawyers you have to kill to get a pound of brains?"
Almost everything known about the druids was written down by the Romans, who were their enemies and somewhat suspect as witnessess. Most of the rest is crap made up out of whole cloth by Victorian Romantics.