I am also having this same issue.

Looking back, I found in 2006 someone asked for this:    SELECT     *    FROM         ModuleControls   WHERE     (ControlSrc LIKE '%blog%')

So here are my results. Then I will explain how I got here.

We recently installed a fresh installation of 4.5.5. DNN. The Blog module was installed and working fine. Then, the blog module was deleted accidently, but quickly re-installed simply by downloading the latest version and installing it. Once again it was up and running fine.

Then we decided we could upgrade to 4.6.2 just prior to the release of 4.7.0 and upgraded to 4.6.2. The blog appeared to be working okay at this point as well. Today we upgraded again to 4.7.0, just three days after the upgrade to 4.6.2 and the blog has failed with this same error:

Error: Blog is currently unavailable.
DotNetNuke.Services.Exceptions.ModuleLoadException: An error has occurred while establishing a connection to the server. When connecting to SQL Server 2005, this failure may be caused by the fact that under the default settings SQL Server does not allow remote connections. (provider: SQL Network Interfaces, error: 26 - Error Locating Server/Instance Specified) ---> System.Data.SqlClient.SqlException: An error has occurred while establishing a connection to the server. When connecting to SQL Server 2005, this failure may be caused by the fact that under the default settings SQL Server does not allow remote connections. (provider: SQL Network Interfaces, error: 26 - Error Locating Server/Instance Specified) at System.Data.ProviderBase.DbConnectionPool.GetConnection(DbConnection owningObject) at System.Data.ProviderBase.DbConnectionFactory.GetConnection(DbConnection owningConnection) at System.Data.ProviderBase.DbConnectionClosed.OpenConnection(DbConnection outerConnection, DbConnectionFactory connectionFactory) at System.Data.SqlClient.SqlConnection.Open() at Microsoft.ApplicationBlocks.Data.SqlHelperParameterCache.DiscoverSpParameterSet(SqlConnection connection, String spName, Boolean includeReturnValueParameter, Object[] parameterValues) at Microsoft.ApplicationBlocks.Data.SqlHelperParameterCache.GetSpParameterSetInternal(SqlConnection connection, String spName, Boolean includeReturnValueParameter) at Microsoft.ApplicationBlocks.Data.SqlHelperParameterCache.GetSpParameterSet(String connectionString, String spName, Boolean includeReturnValueParameter) at Microsoft.ApplicationBlocks.Data.SqlHelperParameterCache.GetSpParameterSet(String connectionString, String spName) at Microsoft.ApplicationBlocks.Data.SqlHelper.ExecuteReader(String connectionString, String spName, Object[] parameterValues) at DotNetNuke.Modules.Blog.Data.SqlDataProvider.GetBlogModuleSettings(Int32 PortalID, Int32 TabID) at DotNetNuke.Modules.Blog.Business.Utility.GetBlogModuleSettings(Int32 PortalID, Int32 TabID) at DotNetNuke.Modules.Blog.Blog.Page_Load(Object sender, EventArgs e) --- End of inner exception stack trace ---

Other than this, the only other thing we notice is that the server performance is much slower than it was on 4.6.2. Everyting else is working just as it had before.

Anyone have any suggestions on why this is occuring and how we can fix this?

You may have a more detailed error message in the EventViewer. Have you looked there?