There can be no democracy without an informed citizenry. If you don't know who the candidates are, what the issues are and what the state of the nation is, you can't make a meaningful decision at the polls and you are in a poor position to communicate with those who represent you. (Even direct democracies involve some sort of executive branch to carry out the will of the people). Without this information, decisions made in the voting booth are random.
If you live in any polity larger than a village, you need more resources than chance conversations with your neighbors and co-workers can provide. Indeed, in states with millions of people and in a nation of hundreds of millions of people, citzens must rely on third parties, collectively, the media, for essentially all information relevant to their political decision making and involvement.
From this foundation, a number of otherwise counter-intuitive aspects of politics become more clear. For example, decisions in well publicized elections are likely to better reflect the will of the people than less publicized ones. Generally speaking, this means that the people at the top of the ticket are more likely to reflect the will of the people than the people at the bottom of the ticket. The public at large is likely to have more information about the candidates for President or Senate or Governor than they are about the candidates for city council or the state legislature. On the other than, down ticket candidates are likely to be picked primarily by political elites, as the less informed choose not to vote because they don't understand what they need to in order to vote meaningfully in down ticket races. Thus, demogauges will tend to float to the top of the political heap -- since they can appeal to the masses, while understated and thoughtful politicians may linger at the bottom of the heap, since they can appeal to political elites.
This also means that the quality of information people receive, and the spin that comes with it, does matter. Opinion polls don't determine truth. Opinion polls are like classroom quizes. They determine what people have learned from what has been presented to them by the media. When politicians respond to polls, they are really responding, indirectly, to media coverage. And, since ultimately politicians rise and fall based on one big poll on election day, politicians are, to a great extent accountable to the media.
The media, of course, is not unchecked. Any particular media outlet has power only to the extent that it can influence the opinions of its consumers. If a media outlet loses its credibility, it loses influence. This influence, however, is basically a zero sum game. Since citizens receive almost all of their information from one media outlet or another, citizens who want to participate in the political process have no choice but to listen to something. In the absence of meaningful information, again, there is no democracy.
Unfortunately, the media, collectively, have a tendency to be lazy and take the press releases that they receive from political leaders at face value, even if they aren't accurate. The media have an interest in keeping the channels of communication open with news sources, and that isn't enhanced by calling out news sources you need as liars on a regular basis. Likewise, in an effort to avoid alienating consumers of the media, the mainstream media tend to present different opinions as equal, even when the facts clearly favor one side or the other.
Blogs are both an independent media source -- with some original information, and a filter, that mediates the never ending credibility battle within the media. They are far less beholden to media sources and media consumer markets, and thus don't have those institutional barriers to presenting the straight story. At their best, they make it harder for the media to deceive or mislead people, by checking facts and questioning assumptions in the mainstream media. It isn't by accident that bloggers stridently claim to be part of the "reality based community". At their worst, they make it easier for people to reinforce their own cognitive biases, by filtering or explaining away news that doesn't agree with their views, or by simply allowing rumors and mistruths to propogate. Blogs have consumers too.
The balance between the good and the bad potential of blogs is governed, to a great extent, by the norms of blogging community.
Some of those norms promote accuracy. The norm of backing up assertion with hyperlinks brings standards of proof parallels the academic tradition of footnoting sources to public discourse. The norm of skepticism and challenging assertions made by bloggers in comments parallels the benefits of peer review in the academic tradition. The norm of disciplining trolls in blog forums parallels the academic credentialing process.
On the other hand, blogs are also marked by a norm of partisanship. Hyperbole is common, and most bloggers, in the political sphere, are advocates, not neutrals. The same mechanisms that drive out idiot trolls also drives out what is often rational, if obnoxious dissent. Some claims receive more scrutiny than others. And partisan blogs typically have their own informal credibility ratings for mainstream media outlets that can unnecessarily prejudice information from disfavored sources. Alleged first hand accounts can turn out to be wrong.
To the extent that blogging norms create an incentive for rest of the media to be more informative and accurate, democracy is profoundly enhanced, because the opinions to which politicians respond will tend to be better founded. If blogs had been more successful at debunking mainstream media outlets like Fox that led people to wrongly believe that there was a connection between terrorism and weapons of mass destruction, and Saddam Hussein, the Iraq War might never have been fought. But, to the extent that blogging simply makes the news more partisan, it can become just another part of a political spin machine, and can aid the process of propogating the "Big Lies".
Blogs do have a vital role in our democracy, because they mediate the media sources that drive our democracy's political decision making process. But, they will only enhance that process if we emphasize the norms that keep the media honest, and suppress the urge to follow norms that can shelter us from unpleasant truths. Gullability and believing your own hype are the greatest sins of blogging.