New Registration Not Creating Blog. What Am I Missing?

I've set up the blog templates plugin and have created a template as the "Default" to be cloned.

Now the issue is when I do a test registration it creates a new user account but does not create a new blog.

#1: how do I fix that... what am I missing?

#2: I'm running out of test email accounts! I've deleted all users yet when I go to test the system again it keeps telling me the email is still in use. Where do I look to delete my tests permanently?