I really do salute you.
Ok, first and foremost, this is a heckuva module. As far as I can see it, the archive will be useful in individual blogs, or as a "time capsule" for displaying new posts filtered by day.
Then of course the signup module that doubles as a control panel of sorts is a nice piece. That, I can not see improvements on...
The search piece is likewise good. However, a radio button to search for the blogger would be stellar. Additionally on the admin (settings) side of the piece, perhaps an option to search catagories rather than individual blogs would be beneficial in a large community environment. This is due to the drop-down scrolling to Kimchatka by the time the list of blogs reaches about 150 or so. I don't see any other solution, but if there was a manageable list of catagories, we are in business.
Then of course the blog list. Simply by paginating it, then you don't really need to do anything more. I would recommend filtering it by last post first. This way, you will be showing the freshest blogs up front. I realize that it is somewhat redundant with the most recent blog entries, however a good solution nevertheless. Alternatively, they could be sorted based on number of blog posts, or points. Points particularly if the points are awarded based on a per word/character basis. This, I believe, would encourage users to post more.
I will chew on this some more.