In general the option to choose which ever blogs are selected and used to display "articles as news" is good. However, it poses as possible issues too.
1) If every user that joins has at least 1 blog each, and 50 to 5,000 users all have a blog each, that's a lot of blogs to display in there to choose from. I think this field or option should be limited to just site administrator only. Reason being I'll share below.
2) If administrator chooses some people's blogs (that generally are good bloggers, nice, etc) to be used as "articles as news", and for some reason the person(s) get angry at administrator and in middle of night (while the administrator is sleeping), then posts articles containing porn images, self nudes, etc it wouldn't be good and administrator won't correct it until they're awake 8 to 12 hours later. Every guest, user, etc visiting the site dashboard page would get a big surprise until administrator wakes up and handles the matter. I'm not sure about you, but I'd hate to come visit site as guest, and the dashboard is full of articles with porn images in them or what-not. lol
I think this field or option should be limited to administrator blogs only, where the administrator can choose his own blogs or create special blogs to be used to pull "articles as news" from, such as: Announcements, FAQ, Development, "Site Name", blogs he creates specifically for site related articles. Not just that, but again, if 5,000 users all have 1 blog each, that's a huge amount of blogs in there to sort through and go through etc. In example image above there, I created two test blogs as administrator account "Announcements" and "Help", but then manually added a test user "Smooey", which created "SmooeyCom" test blog, and now "SmooeyCom" blog shows up as well.
Maybe some how in future or with plugin, this option can be dealt with a little better or have a little better control over it. Perhaps two check boxes, one for Administrator blogs only, and another check box option to enable All Users Blogs if wanting to use other user's blogs not just administrator's blogs.
If check box for administrator blog only, then All Users Blogs get greyed out and not usable. Or maybe two separate option fields, one for only administrator blogs, and another separate option field containing only all user blogs. If administrator decides to create 2 more blogs later after 5,000 users all created blog, then he'd have to weed through 5,000 normal users blogs to find his latest created blogs in the big list.