Mikey has this down really good. Blogs can be a huge asset.
An example of a blog that a client uses is this:
http://cargocontainernews.containersstorage.net/
Articles will be written for added content to the site but to also get rankings and provide some needed internal links.
Blogs are a FANTASTIC way to add content to your site and build more of a relationship with your client.
When you write a blog post you should have some sort of idea of what keywords you would like to target and blogs are GREAT way to target long tail keywords that can get you good traffic that might surprise you.
And EVERY post, if it is decent, should be social bookmarked. Those social bookmarks can get good rankings and drive traffic to your site that you might not otherwise get.
All sites should have blogs.
DevilDog