One reason is that the Blurb book is often the only publication available on a particular artist. If you're really into someone's work the Blurb book may be the easiest way to get it in front of you.
Still, the marketing equation for these Blurb books is an uphill fight. One strategy around it, taken by my friend Chris, is to offer a print with each sale. $100 may be a lot to spend on a book but it's pretty cheap when you include an exhibition quality print.
Speaking of books, Jeff Ladd has just announced a new venture which promises to increase the accessibility of out-of-print photo books. One of my great pet peeves is that so much of photographic history is buried beyond reach in out-of-print books. Photographers are left wandering in the dark. Can you imagine if, for example, scientists operated under the same model? What if scientific papers were published and then left to go out of print? Some lucky or rich scientists would have the benefit of studying prior research, while the great mass would be left to start at square one. Totally ridiculous, of course. Well that's the current state of things in the photo world. Hopefully Errata Editions can make inroads. Go Mr. Whiskets!