I would like to add blogs to all of my directories eventually, but regarding how i should add a blog i would like to know do you generally add as a subdomain or is anyone running theirs seperate? Also what is the difference from setting it up as blog.directory.com and directory.com/blog?
You should add your blog as directoy.com/blog. Subdomains are considered by most search engines to be separate websites to the main domains. You want your blog to add value to your main domain, so add it to the main domain.
Is it an older, trusted domain? If so, I'd go with a subdomain. If it's a newer site, I'd go the subdirectory route.
Subdirectory is where you create a new folder in FTP mode, it doesnt make it a seperate site. Subdomain creates almost a seperate website - seperate FTP, seperate stat tracking etc. It will allow you to use blog.domain.com as well as domain.com/blog
Subdomain will be treated as a seperate website making a bit better, if you can with your host try getting your subdomain on a seperate IP. I was able to do so with dreamhost.