You may want to run WordPress in MultiSite mode. It allows you to have thousands of blogs in one install. This is a huge benefit when it comes to updating plugins, themes, customizations, etc… The multi-site setup also allows you to share user accounts between blogs, so if you give people permissions on your main site, you can give the same account permissions on any of the other blogs. It is all the same account, so no extra username and password for your visitor’s/guests to remember, no need to re-log in when switching between sites, etc…
I can’t really say much about the SEO aspects, I’ve never paid much attention to those algorithms.