Insulation

So I spent the day looking at different types of "green" insulation for a project I am working on in San Diego and all I could think about was- Do the exterior walls of my house have any insulation at all? I am sitting here in our office, freezing, as I type in a long sleeve shirt and pants.
But back to the subject, there are several types of good insulation, cotton batt insulation, recycled newspaper insulation, soy bean spray insulation and through all these good, healthy types of insulation discoveries I am thinking to myself- Would these do any good in my house? Is it pointless to put organic insulation in between asbestos coated walls?
And then there arose a deeper question. Am I living a lie? I chose this house, with it's non insulated walls and windows, it's lead paint, and moldy restroom ceiling. I love this house. But I spend my days preaching against all the things I live with every day. I cannot use fluorescent bulbs in most of my fixtures, because my wiring makes them blow. And since I am in confession mode, I bought paint for my bathroom last week and no it was not the low VOC type! Gasp...I know.