I just now installed the avatar plugin.
I followed the instructions to the letter and uploaded the files to the appropriate directors, created the appropriate directors and CMOD to 777. I also made the suggested addition to .htaccess.
When I click on "upload user avatar" on the default theme page, I get the correct page. When I click on the "upload blog avatar" link on the default theme page, I get the following message: "Cannot load blog-avatar."