How to maximize Peltier devices' cooling capacity?

inside the device, the cool side is already in physical contact with the hot side: they form a junction through which electricity is flowing, and it is that flow of electricity which makes one side of the junction get hot and the other side cold. the very best you can do to maximize the usefulness of a peltier thermojunction is to put fins and fans on both sides of the junction so as to get as much of the heat out of the hot side and cold out of the cold side (so to speak). indeed, the cold side needs to be well-insulated too so the cooling effect is not lost to the environment. styrofoam is good for this, as you point out.