"Deleting an ‘unused’ blog gives no benefit to wordpress.com. While you might feel it will benefit you because then you can get a name you want, what if someone wants your current name? And someone else wants another name? It either turns into a blog collection or a rolling chain of name swapping. It could also turn into a mad rush and accusations of who deserved what if blogs were recycled."
I don't agree. I'm not asking for someone else blog. If somebody owns a blog and hasn't updated it for years, it's still his. I cannot ask him to give up his blog. But if the blog is a demo blog, and owned by WordPress, then surely you can. I see no reason why this could lead to a "mad rush". A demo blog has no real owner, technically. It's owned by WP. So they can surely make certain blog names available if they want.
Once a blog name is made available, it will belong to the first person who signs up for it. No questions asked, no accusations.
I think you better give this issue some thought.