There seems to be a misconception here that diamonds are relatively common. As someone who has worked with diamond prospecting, I can guarantee you that this is not entirely truthful. Sure, there are other gemstones that are rarer, such as rubies, but diamonds aren't common by any measure.
Diamonds are hosted in a breccia (fractured rock that's been re-semtented) consisting primarily of kimberlite, a volcanic rock that forms large pipes which bring the diamonds from the mantle to the surface (or surface near regions). Though disputed, it is thought that diamonds form from methane gases in the mantle. Diamonds can only be found in such volcanic pipes due to how they are the only way to bring them to the surface fast enough and at moderate temperatures (diamonds oxidize over time, and cannot withstand temperatures in excess of 550 degrees Celsius). About 1/100 kimberlites are diamond hosting, and 1/10 of said diamond hosting kimberlites contain economic deposits (in which only a fraction of the diamonds are gemstone quality). So in short - one in a thousand kimberlites contains diamonds that can potentially end up on someones finger. And as far as kimberlites go, they aren't exactly common occurrences, and also require specific geological settings. So, diamonds are rare.
Now, on to the mining of diamonds... A decent grade, i.e. the amount of diamond per ton of host rock, is approximately 4 carats per ton. 1 carat for diamonds is 0.2 grams (not the same carat as e.g. gold), so less than one gram per ton. Of which only a small amount is of gemstone quality.
There is however no doubt that the price of diamonds is artificially inflated by the companies who sell them, which is done by stockpiling the surplus to create an false drop in supply.
So, diamonds - rare, but overpriced. If you're opposed to the use of diamonds on account of there being a chance of them being "conflict diamonds", you shouldn't worry. The diamonds you can get in your local jewelery shop are most likely Canadian or Russian, or a non conflict African diamond. Even if the companies that sold them had no sense of right and wrong, the risk outweighs the profits in terms of conflict diamonds.
Artificial diamonds are also incredibly useful. Diamonds with boron inclusions (blue diamonds) are semiconductors, with greatly beneficial properties compared to the silicone used in most computers today, mostly because of greater heat resistance (i.e. less need for cooling).
Personally, I prefer sapphires or diamondites (which are garnets with an equal lustre), because I think it looks nicer, but I have no objections against diamonds.