Q: Say I wanted to lose weight overall but build bigger muscles in my legs only. How would I go about doing that?

A: I would still recommend the same approach to losing fat as in other cases: diet + heavy whole-body weight training + slow weight loss of 1 pound/week or so. While you're losing fat and weight your muscle build-up will be pretty minimal if at all, so I would exercise all the muscles to maximize fat burning. Once you reach the point when you feel you've lost all the fat you want to lose, then you can go from the fat-loss mode to muscle-building mode by upping your calories to very very slowly start gaining weight (1 pound every two weeks is a good rate). In this overeating mode you'd be able to make serious muscle gains and that's when you'd probably want to exercise only your lower body (or at least give it serious priority). Some of the best lower-body exercises are squats and lunges of all sorts, so make sure to include them in your routine.

So to summarize... Phase 1: lose fat through heavy whole-body weight training + fat-burning diet to lose 1 pound/week. Phase 2: build leg muscle through heavy lower-body weight training + bulking diet to gain 1 pound every two weeks.