BuddyPress.org

Actually, I just did this on a test bed. Took maybe ten minutes.

make a copy of the home theme and move it somewhere.

rename the folder to something obvious, like bp-blog-theme.

Edit style.css and change the theme name to be Blogs instead of Home.

Delete home.php.

move the new theme back into wp-content/themes/. Activate it under Site Admin -> Themes. Go to a member blog (you have a test blog, right?), under Appearance and activate the new BLOG theme.

Give it a whirl and let me know how you make out. There’s other regular WPMU plugins to enable the theme by default on a new blog. My fave: http://wpmudev.org/project/wpmu-blog-defaults. That way the blog creation part is seamless and looks well-integrated.