I was wondering if this software will allow users to register and create there own blogs

That's what it was built and designed to do...
http://b2evolution.net/index.html
http://b2evolution.net/about/features.html

Actually it doesn't do that. Anyone can register if the admin allows registration, but it doesn't create a blog for them. The admin would have to create a blog and give the new member permission to post in that blog, meaning it's not automatically going to build a blog for each new member. I believe there is a plugin that makes it automatic though.

Ok Thanks guys. I will check out the plugin section then.