Interesting project ;-)
b2evolution is multiblog sure. I think you will have to design your own architecture, for example by setting http server and mysql server on differents machines.
What's the audience (hits) per day for all thoses blogs ?

it is about 30.000 pages view per day.
Why do you say we might have to set an http server and a mysql server ?

b2evolution and the bloghoster thing you mentioned are quite different by design. Specifically, b2evolution expects that the admin will take care of blog creation and assigning permissions to bloggers. Looks like bloghoster is designed to automatically create a blog per blogger with (probably) no other levels of interaction?

As to scalability, biggest I recall ever seeing was a Japanese installation that claimed over 1000 distinct blogs and bloggers. b2evolution "claims" scalability is limited by the underlying code (php and mysql), which is I'm pretty sure what slamp was hinting at. Like, splitting the burden between servers ... or something like that. I'm not clear on the smart server-side stuff.

Scalability internal to b2evolution is basically unlimited though. The problems you'll eventually find will be in things like managing all the blogs/bloggers and all the various cross-related permission settings. Many, and probably most, pages that list those bits have gotten pagination but I reckon sooner or later you'll find a page that is trying to list over 1000 somethings - which would be a bit cumbersome eh?

I was thinking about millions hits per day so I guess you have your own hardware serverS.
For 30000 hits / day you can use b2evolution for 6000 blogs without any load problem. b2evolution include some cache system.

To test b2evo you can install it on localhost or try the online demo: http://demo.b2evolution.net/

To allow users to create their own blog you can install autoblog plugin: http://forums.b2evolution.net/viewtopic.php?t=15842

the idea is to add a software level that automatically generate user and his blog parameters when the user subscribe.
As I test it I see that admin seems no to be made for thousands of blogs. For example it list all the blogs of all the users in the horizontal menu. The normal user saw also all the blogs !

Try upgrading to 2.4.2. More than 5 blogs are shown in a dropdown. The users are only shown blogs that they have access to, so as admin you'll see all, as joe blogs you'll only see 1 or 2 ... or however many joe has access to.

¥