For example, if it develops some diet drug that lets you safely enjoy eating and still stay skinny and beautiful, that might be a better result than you could provide for yourself, and it doesn't need any special understanding of you to make that happen.

It might not need special knowledge of my psychology, but it certainly needs special knowledge of my physiology.

But notice that the original point was about human preferences. Even if it provides new technologies that dissolve internal conflicts, the question of whether or not to use the technology becomes a conflict. Remember, we live in a world where some people have strong ethical objections to vaccines. An old psychological finding is that oftentimes, giving people more options makes them worse off. If the AI notices that one of my modules enjoys sensory pleasure, offers to wirehead me, and I reject it on philosophical grounds, I could easily become consumed by regret or struggles with temptation, and wish that I never had been offered wireheading in the first place.

Putting an inferior argument first is good if you want to try to get the last word, but it's not a useful part of problem solving. You should try to find the clearest problem where solving that problem solves all the other ones.

I put the argument of internal conflicts first because it was the clearest example, and you'll note it obliquely refers to the argument about status. Did you really think that, if a drug were available to make everyone have perfectly sculpted bodies, one would get the same social satisfaction from that variety of beauty?

If it can do a reasonable job of comparing utilities across people, then maximizing average utility seems to do the right thing here.

I doubt it can measure utilities; as I argued two posts ago, and simple average utilitarianism is so wracked with problems I'm not even sure where to begin.

Comparing utilities between arbitrary rational agents doesn't work, but comparing utilities between humans seems to -- there's an approximate universal maximum (getting everything you want) and an approximate universal minimum (you and all your friends and relatives getting tortured to death).

A common tactic in human interaction is to care about everything more than the other person does, and explode (or become depressed) when they don't get their way. How should such real-life utility monsters be dealt with?

Status conflicts are not one of the interesting use cases.

Why do you find status uninteresting?