1) Simple setup. 2) Faster publishing. You no longer wait for files to transfer to your remote host; as soon as you click publish, the post is available and all archive pages are updated. 3) Drag and drop template editing. Blogger's newer templates offer you a lot more in terms of customization, and make designing your page a much simpler process. 4) Access control. You can restrict access to your blog when we host it; there's no way to do this natively within Blogger (though your webhost may offer a way to do this separately).
5) Fewer moving parts. As I've dug in over the last few weeks on issues relating to FTP, as often as not the problems were not Blogger-related but were a byproduct of a webhost implementing stricter security on FTP logins (only whitelisting certain IP addresses, for instance, or throttling access for certain users). These are notoriously hard to isolate, particularly when they involve coordinating support with a third party. No one - including us! - enjoys the terrible back and forth of "it's the webhost's issue" "no, it's Blogger's issue" "no, we're pretty sure it's the webhost's issue" when all you want is to be able to post to your blog. 6) Free, scalable hosting. Google knows a thing or two about hosting content around the world, and by relying on Blogger for hosting you're getting the advantage of a robust hosting environment - for free!
RewriteEngine On RewriteBase / RedirectMatch 301 ^/blog/(.*)$ http://blog.yourdomain.com/$1