An article at Cyberatlas (a cousen of Jupiter Research) covers Blogging By The Numbers.

According to BlogCount, there are 2.4M-2.9M active blogs. This is based on reports of active blogs from three biggest blog hosters (Blogger, LiveJournal, & DiaryLand) and estimations based on other data points (e.g. Bloggers in Poland, RadioLand & MT estimates, etc.)

According to Jupiter, 2 percent of online world blogs, 4 percent reads the blogs. Interesting demographic contrast between readers and writers, writers relatively more men and higher income.