From the American Diabetics Association 2008 (Nutrition Recommendations and Interventions for Diabetes):
ENERGY BALANCE, OVERWEIGHT, AND OBESITY
In overweight and obese insulin-resistant individuals, modest weight loss has been shown to improve insulin resistance. Thus, weight loss is recommended for all such individuals who have or are at risk for diabetes. (A)
For weight loss, either low-carbohydrate or low-fat calorie-restricted diets may be effective in the short term (up to 1 year). (A)
For patients on low-carbohydrate diets, monitor lipid profiles, renal function, and protein intake (in those with nephropathy), and adjust hypoglycemic therapy as needed. (E)
Wow. Back when I was a newly diagnosed T2D (in 2003) they were saying LC is bad. Now it is one of the recommended diets for Diabetics. Reading on…
The optimal macronutrient distribution of weight loss diets has not been established. Although low-fat diets have traditionally been promoted for weight loss, two randomized controlled trials found that subjects on low-carbohydrate diets lost more weight at 6 months than subjects on low-fat diets (19,20). Another study of overweight women randomized to one of four diets showed significantly more weight loss at 12 months with the Atkins low-carbohydrate diet than with higher-carbohydrate diets (20a). However, at 1 year, the difference in weight loss between the low-carbohydrate and low-fat diets was not significant and weight loss was modest with both diets. Changes in serum triglyceride and HDL cholesterol were more favorable with the low-carbohydrate diets. In one study, those subjects with type 2 diabetes demonstrated a greater decrease in A1C with a low-carbohydrate diet than with a low-fat diet (20). A recent meta-analysis showed that at 6 months, low-carbohydrate diets were associated with greater improvements in triglyceride and HDL cholesterol concentrations than low-fat diets; however, LDL cholesterol was significantly higher on the low-carbohydrate diets (21).
So everything (except LDL) was better with LC. And they did not differentiate between the various LDL (small particle size vs large).