BuddyPress.org

This thread is going around in circles; I’m closing it. In a nutshell:

If you want to offer your members their own blog, then you will need to use WPMU. The fact that each of your members has their own blog does not mean they have their own site. All the blogs are located on and served from your site.

If you only want to have one blog but offer a social networking layer on top of that using BuddyPress, then single-version (solo-blog) WordPress is all that you need.

You can use single WP and assign users a WP role of contributor or editor if you want users to post on the same blog.