Ranking items based on quality is really hard. It's quite complex, whenever anyone talks about ranking by quality or relevance, the factor traditionally used to rank, both are relative measures. What is of interest to me might be of no interest to you. We (in theory) have a straight-forward mechanism for indicating how interesting a blog is: the ratings. Since the assumption is the quality of the blog post should dictate its place on the list this seems reasonable. But based on my experience blogging (perhaps not an indicative sample) rating is rare in comparison to views, and this creates a problem of sparse data to base ranking on (It also creates a problem of malicious users deciding to one-star having a greater impact than they should). Like voting, it's not nearly as good if only a few participate. This is compounded if ratings aren't used well, which Evan Miller talks about in an article called How Not to Sort by Average Rank. This was why I recommended that future algorithm improvements should take into account factors not limited to ratings, as things like views and comments give more implicit data to work with.
In its current state featured blogs look like they are ranked based on average rating of the author. This may be (in fact I'm willing to bet it is) a simplification, but the end result features blogs based on some shaky principles. A small group will be auto-featured based on prior performance, regardless of what that blog says, and users who write interesting content will have to spend a long time doing it before they get into that group. This, at least for me, is similar to the RSS set-up, I am subscribed to the highly-rated bloggers I want to read.While the blogs that have been featured are great this rating-focused approach could be seen as bad (it's not necessarily representative of the current state of blogs, it funnels views into blogs by users who are already highly praised, people who write good content and aren't already well known won't get featured). It is open to abuse too, as users high on the rankings have a 'veto blog', i.e. absolutely anything Trozz blogs about right now will be in the featured blogs section, and will knock out the lowest ranking entry.
So, while I believe it is not the intent of the section, the question becomes "Should we have a special group of bloggers who are 'featured'?". This could be an entirely valid way to form a featured blog list, as could manual curation, and it warrants discussion. Either way a list of great blogs formed based on shaky principles sort of grinds my gears, which i suppose is why I research this stuff!
Another way to highlight specific blogs is to potentially weight for content, so for example we hide girl blogs and promote terms we think will be associated with good blogs, both of which could create problems. We could miss "[Girl Blog] Video of me being shot down by every single Iron Lady contender" or some similar interesting blog, but more concretely this can be gamed, so we'd end up with fake blogs like:
[Random malicious blogger]: I beat Day in Starcraft, here are the games, commentated by Klazart
(I would love to see that blog)
As you can see it's not a trivial task to try and pinpoint good blogs, but I came up with a couple of ranking methods that I've been playing with to find good blogs. Note that for 'Blogs of the Moment' there are two methods; one that favours blogs that encourage discussion (similar to a good ratio of views to comments, allowing for interesting blogs with a low number of views to appear) and one that tries to offer a balanced list of interesting content. I only scrape the blog front-page for this so can only use what you see there, views and comments. I don't have access to ratings so I don't use them, but I think without them there are some pretty interesting results.
Highlights the blogs that currently seem to be generating the most interest, regardless of author current views
Offers a very straightforward mechanism for rewarding a blog; comment!
Reflects the current state of blogs
Very hard to game
Only works on first page
Doesn't use ratings
I'm sure it could be refined further
So I've rambled and made assumptions (if they are wrong then we have two additional ways to find blogs to read at worst), I hope I've been clear on my concerns despite the interesting blogs I've seen through the featured blog section.
Edit: added image