Can the iPad do a blog now?

Yes, it can, but you have to go to the "edit" tab to do it, and then you're editing the raw HTML. But still, it's better than nothing, which is what you have otherwise.

And I'm finding that I type better with just a couple of fingers rather than the whole hand, on this virtual kbd.

Using preview works fine, result look ok. You can always go edit later on a real compy.