I would uninstalled and re-installed. sounds wierd.

There might be something you changed that now prevents this. Please search the forums as I'm pretty sure this has been covered very recently. Search isn't the easiest thing to use though, so have a bit of patience and use multiple words to narrow your search.

I searched the forum but can't seem to find what I'm after. :(

I've done a lot to the site but I can't remember what I changed :( I've compared the backoffice options with another b2evo site and they're identical! Once can't create and the other, no problem... unless there's something I overlooked...

I do notice one difference, for admin user, the other working site uses 'admin' whereas the site where i want to create a new blog does not use 'admin'. Could this be the problem?

Uninstall and reinstall is always the last option.

Dashboard -> Users -> Administrators (click the link) -> Settings(at the bottom) -> Edit/delete all
I think this is what you are looking for.

Good luck

I used Afwas's solution. Didn't do any change (Edit/delete all was already clicked.) All I did was click Save button and the link to create new blog pops up in Dashboard!

This is weird. Oh well, it works and I'm happy. :)