How to limit the products available to choose from, in the inline entity form of a product display
When you are adding an existing product to a product display there is an autocomplete field that you can use to search existing products.

This field is called entity_id. If you use hook_form_alter() and inspect the form you'll see this field has a property called #autocomplete_path.

e.g.

$form['product_display_variations'][LANGUAGE_NONE]['form']['entity_id']['#autocomplete_path'] = 'inline_entity_form/autocomplete/node/product_display_variations/product_type';


You can visit that URL and see it just returns a set of json formatted results.

You can create your own path with hook_menu() and then use your path instead of the default one (make this change in hook_form_alter).

In your custom menu callback you can apply any additional logic (e.g. filtering by uid) to just return a sub-set of products. Then use drupal_json_output() to return your dataset.