Most of the classroom blog projects I see are focused on student or group research projects. I wanted to give my students the opportunity to involve themselves as writers for a blog that functions as a class literary magazine. (I'm finding that more and more of our focus in class is taking up with analytical and expository writing, and it's nice to give students an additional way to write creatively as well as incorporating their analytical skills.)
I set up a class blog at Blogger (this is free. Wordpress and Edublog are other good, easy blog sites), a project requirement page, and a menu of writing choices. Students are asked to sign up for one of several staggered submission deadlines over the year, and meet that deadline with a 500 word written essay or article that follows one of the guideline choices.
Students are also required to comment regularly and constructively to the writing of other students. They love to see themselves featured, and we begin to build a community of writers from the first month of school.