So I took off the nofollow tags in one of my blogger blogs. Funny thing is I update it frequently and I notice it dropped in search engine rankings A LOT. Probably by like 80 listings. Not sure if the nofollow tags on blogger is important or not, but just letting people know
Linking to many sites with DoFollow will decrease your PR. That's quite normal. Try to limit the number of DoFollow outbound links and use NoFollow on comments.
I'm not sure if it is just removing nofollow. In the past few months my site keeps going up and down from 0-2. It largely was due to moving/removing internal links and some had not been indexed at the time of the PR update. My site also never left the top three spot even at 0. The serps were probably just being wonky as they are right before they do an update. All comments and friends links are dofollow. Any posts that are a list of links are normally 'nofollow' unless it is a friends link. I'm careful who I add in my tools list since it is all dofollow. If your post is good you get added. So my PR actually went up and I'm ready for the next update.
You've got this completely the wrong way around. Anything within a post is editorially given by you - you shouldn't be nofollowing it. And comments can be spammed and you are not placing those links yourself - its them that should be nofollowed.
Comments are monitored and the only nofollow links are on posts with lists. If you look at my Blog Marketing Tools (below) all those links are nofollow. All my internal links? Hell yeah they are dofollow.
Linking out to any site considered to be a "bad neighbourhood" with a DO follow link can certainly affect your rankings. I would keep the no follow on unless you are goign to edit all comments/links very very carefully.
We have found that blogs with the nofollow attribute gets 35% less traffic than the dofollow. Do you think that adding the nofollow attribute harms your blog?