Since the topic of discussion has wandered slightly from the general WP MU functionality, I thought I'd post my two cents. The client I'm working with right now needed a solution to populate several thousand domains (not all at once, obviously) with content and registration functionality married to offers. They weren't as interested in the SEO implications because of the obvious duplication of content issues, but they needed something up on these domains just to give them a born on date and they are hoping to grab a few bucks here and there just from pure arbitrage luck. Part of the plan, as well, was to limit duplicate content both across the vertical and across the entire network so that the entire network never hit higher than 20% duplicate content and so that a vertical also never hit higher than 20% duplicate content inside of its vertical network.
Anyway, the constraints they and I imposed after several meetings were that the system should be aware of its own internal category taxonomy, the system should be able to automatically recognize its identity and place in the taxonomy by parsing its own domain and then it should share content with the other blogs based on what category the content was assigned to during creation and where the blog itself sat within the taxonomy (the entire network is the top level, each vertical [travel, diet, whatever] is the next level and each domain is the bottom level). There were internal constraints as well about how it handled cross-channel registrations and how it would itnerface with web services and internal accounting systems, but those are less germane.
During discovery we took a look at a lot of technology and ended up focusing on MT Enterprise and WordPress. In the end, I suggested that we go with WordPress and we began hacking into it. During this dev phase a few months back, we stumbled across WP MU (I don't know why, but I hadn't heard of it). Let me tell you, that was a gigantic two week waste of time for this particular application. WP MU makes a pretty fair amount of sense for managing a bunch of independent blogs independently, but if you want to manage tons of blogs with their own domains and identities as a transparent network with any level of shared content, it's much easier to hack up native WordPress to do this.
I've already blabbered on forever, but the core steps to getting this working involve grabbing the blog_id field by looking up the domain during the precaching phase that WP goes through before it calls the template. Once you've done that, the only tricky part is teaching it how to intelligently limit what content it posts based on categories. By copying and hacking up some of the category functions like get_category_parent_ids you can extend the functionality pretty easily, but the thing that I still recall as astounding was that Wordpress built WP so that handing the caching engine a parent id returns content from that parent and all child ids and there's no way to turn that off except by naming negative category ids for every single child id that you don't want. Granted, I'm the architect, not the mechanic, so I only saw so many difficulties hands on, but working with WP instead of WP MU for this application was much easier.
So, while I suppose it's wandering a bit off topic, WordPress MU is really bad for this kind of single admin/many blogs network concept and WordPress handles it much better. Granted, WP MU isn't designed to do this, so it's not really surprising in retrospect in some ways, I guess going in I just assumed that it would have better domain/blog level functionality and it really doesn't. It's basically just a wrapper.
