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I have found that when baking a cake or pie with oil, that the texture is much heavier and takes sometimes as much as three times longer to cook. When shortening such as butter or margarine is used, the texture of the cake will be lighter and will cook quicker, for pie pastry it will be crisper and lighter. Heavy textured cakes such as Carrot cake are better using oil. Other cakes are better when shortening is used. However, it is a matter of personal preference.
Shortening (lard, solid shortening, butter, and sometimes vegetable or olive oil) is used to "shorten" the strands of gluten formed by liquid and flour. For something like a pie crust it gives the flaky texture. For Cakes it provides the tender "crumb" yet holds the cake together enough to slice. For bread and biscuits it keeps them from being hard roccks. Even the bread made in the Middle East and Naan (from India) need oil to keep them tender.
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