I found that blogging about how to make the product is even better than talking as pure sales man describing a brochure.
So I think that in my case, blog marketing is the way and... you can easily find a way to blog on about how are you making the stuff you're proposing to the world.
I think that you can have great results at least for point 1 and 3. About conversion rate I don't have so much experience.
It is all relative. But I will take a stab:
Targeted traffic sounds the most appealing. If you have the traffic, then you can A/B test and analyze different metrics to optimize your conversions.
Better Conversions is great, but it depends on what the number they are "better than"
Long term effects on Sales it is difficult to understand exactly what you mean by this?
Either way, your product need not be "blogable" for you to blog. Try to determine what industry will likely use your product and blog about topics that are relevant to that industry.
The two methods are really not analogous. Here are some comparison points:
So to answer your question directly, I would say: