It goes without saying but also ensure that as well as 301'ing all the old URL's, that you create a robots.txt to stop Google potentially spidering the new subdomain which contains the legacy files.

Best of luck!

I believe there is indeed talk of Google factoring in nofollow links from reputable sources (Wikipedia for example) however I'm almost certain that blog comments won't be included within this.

We received exactly the same response following a recent reconsideration request after several failed attempts where they reiterated that we still had bad links.  We continued removing questionable links over the following six weeks while I waited to see if they would follow it up with something a little more enlighten but unfortunately nothing was forthcoming.

As such I submitted another reconsideration request asking if they could possibly elaborate slightly and after just two days received exactly the same response again.  As such I’m still a little puzzled.

I think Adam has hit the nail on the head.  We recently moved our blog site from a subdomain to a subfolder and 301'd all the old URL’s with the intention that any entries that users find genuinely useful or interesting will be potentially linked to, thereby providing a benefit to the root domain.

As long as your blog is tightly related to your core business activity then I would go down the subfolder root although, in all honesty, I think subdomains potentially look a little more professional.