As a fairly unsuccessful blogger (hits average 100/day - occasional Instalanches and other linkagery) I might seem the wrong person to opine about this - other than as an example of how NOT to do it. However I'm going to anyway having been inspired by James at Nourishing Obscurity who wrote about me twice over the weekend.
Firstly to make it clear - I'm not blogging for money - I've got various google and amazon ads and so far I've made a bit under $600 from them - almost all of that during the frantic week or two at the end of January/early februrary that I was number 1 in google for "Mohammed Cartoons" and other related search items. This pays the hosting bill (more or less) but entirely fails to keep me in any state that I wish to become accustomed. Secondly and likewise fame: given that I have received very few major hits other than for my Mohammed cartoons page, if I'm in it for fame and glory then I'm clearly failing at that goal too. Fortunately I'm in this lark for fun and hence I'm quite happy with my 100 or so readers per day but it seems unlikely to grow suddenly to produce massive readerships, toothsome book deals or inteviews with the BBC or other media outlet.
Anyway if you want to blog for fame or fortune then it looks like best advice comes from author John Scalzi's recent post where he analyses the different sorts of traffic increase he gets from different sorts of recomemndation, and you may find his earlier port about the top N blogs interesting too. In that post he points out that the top blogs are mostly group efforts and generally speaking have a single focus.
I suspect that the same is true, to a large extent, to many of the medium sized blogs too. To expand slightly on his points, multiple bloggers help by increasing the number of posts and single topic focus helps by attracting readers who are interested in a particular area. It also helps, of course, with advertising revenue because the advertisers know what they will be advertising on, and of course it helps get ads targetted to the readership. So yes, to some extent, you can become rich and famous from blogging, but it seems to require treating the blog as a job. If you do this and write well then your blog will either make you money directly (because you get ad revenue or paypal donations) or indirectly because people like your writing and ask you to contribute paid articles or write books. And it may well, also, make you famous, particularly if you manage to perform some genuine news reporting and add value and information rather than just comment on stuff produced by others. But it is potentially a grind.
On the other hand if you want to blog for fun then all this can be safely ignored. This blog is done for fun and therefore I discuss politics around the world, science, books, photos, olives and pretty much any thing else that takes my fancy. It gives me pleasure and I hope it gives some of you pleasure too. And if by some mischance you end up learning something from it all the better.