I'm grateful to Katy Evans-Bush over at the Poets On Fire forum for pointing me towards Don Share's recent post about bilingual poets in which he quotes Nuala Ni Dhomhnaill on this issue. She invokes inner war, displacement, anxiety, psychic pain, etc, etc...
My own experience is very different. I's important to start by clarifying terms: I'm not bilingual and never will be, in spite of spending fifteen years in a small Spanish town where I've been the only native English speaker for much of that time. I can't be, even though my Spanish is perfect, simply because I wasn't brought up as such. However, my immersion in a second language has led to a heightened awareness of nuances in English. Spanish has cast new light on the way English works, its nuts and bolts, its socio-cultual connotations, its means of expression. All this has made a huge contribution to my poetry.
My son, meanwhile, is completely bilingual. Again, clarification is useful at this stage. He's not just the son of an English bloke - he's as at home in English as he is in Spanish. The two languages complement each other and have never caused conflicts for him. He's simply more aware of his identity than most kids of his age. Nuala Ni Dhomhnaill's plight seems to have more to do with her specific situation than with bilingualism in general.
Immersion in two languages, through bilingualism or second language acquisition, has the power to strengthen rather than dilute. The more counterpoints we have in life and poetry, the richer our perspectives become.