I am making a dairy- and gluten-free cake. What can I use to replace vegetable butter?
Look for the kosher symbol on different types of butter. You will need to find a substitute with the word "Parve" on it. Parve means no dairy products. From there just check the labels to make sure it is gluten free. Other things that I have used to replace butter have been olive oil or applesauce (works great in brownies).
Here is a chart if you would like to substitute olive oil for the butter. http://www.amazingoliveoil.com/substitute-olive-oil-for-butter.html
We usually bake with Earth Balance Buttery Sticks in any recipe that calls for butter. They are dairy and gluten free and can be easily measured by cutting according to the scale on the side of the wrapper, just like regular dairy butter.
If a liquid product is needed, Earth Balance can be melted and will provide more flavor than simply using oil.
You can actually just use oil in cake. I wouldn't use olive oil for a sweet cake. Try any neutral tasting oil or if you are rich, there is stuff like pistache oil wich will undoubtedly give a fancy cake.