Can I sub 1/4 c coconut oil for butter in a cake that calls for 2 c?

I think it will work. As mentioned, coconut oil is often used as a sub for butter in vegan cooking, since it is a solid when cold.

I agree. You run into dangerous territory making substitutions in baking. What if you kept the butter but added a few drops of coconut extract?

After a quick read-around on the internet, it sounds like coconut oil is often an OK sub for butter. However, since baking is so science-y I always feel nervous about substitutions so I think that while there is a possibility it wouldn't, I think it's likely that this sub would work just fine. Give it a go, and let us know how it works out! Also, on a side note, since you're doing it to increase they coconutty flavor of the cake, make sure that your coconut oil is not the unscented kind.

Here's a little more info about making the sub : http://marcussamuelsson.com/news/ingredient-comparison-coconut-oil-versus-butter