Hello Russell,
I know I'm late to the party, but I'll throw in a few cents.
If you're only looking to set up a couple/few blogs (i.e. less than 5) on a domain, then MU may just be overkill.
However, if you're looking for something lightweight to help you manage all the blogs from a single admin panel, then you could look into the .
I've used it myself and on a few clients' blogs without a hitch. Only problem is, it is such an involved plugin, it may not keep up with the WordPress releases (as you can see, the latest version is only up to 2.1). In that regard, I recommend installing the latest version of WP 2.0.x which contains the security fixes rolled into current versions and using the 2.0.x version of the plugin.
And of course, should you have any questions, you know we're here to help.
~ Teli