I suppose it was inevitable that Facebook would some day encroach into blog-space by means of some application. Not sure how well it would do. In terms of features - the FB Blog interface is far from impressive.
On the other hand Facebook already has a 'community' of friends and acquaintances in place for users of the blog. Improvement to the interface is a matter of time - though the look and feel restrictions of having to conform to FB specs may be too onerous.
Lets see how things develop.