The blog module works by grouping posts into categories and then mapping categories to Documents, doing this allows the blog to support almost any site structure that you may require.
To create a category click Blog on the dashboard then click the Add Category icon, enter the name of the new category in to the field labeled Category Name and optionally enter the name of the chunk that will be used to style single posts within the category, then click Create Category.
Next you need to make the category visible on the website, to do this first take note of the category number, this is the number in the square brackets:
Next return to the Dashboard and select Documents, at this point either select an existing document to hold the blog category or create a new document.
In the Content field place the following in order to display the post archive for the category:
Next scroll to the bottom of the page and change Document Behaviour dropdown to Container for Blog Category and in the box next to it enter the category ID, in this case 1, then save the Document.
As you add posts to the category they will appear on the public interface of the website with the category root being the selected document.