There are a number of components out there that cover parts of this feature request but none put it all together. There are a few plugins providing a view of posts by member. One that provides for front-end posts within a group. One that provides a view of posts within a group where it’s been linked to a category. And finally one that links groups to external blogs in a multi-site setup. However none of these collectively quite provide a complete solution for Group Level managed blogs. For one solution I’m working on, I would have a whole of site blog managed by the Site Admin and the optional ability to have a blog within each group with add/edit/delete capability for the Group Admin.