Most people don't beg for donations like Kathy did, because most people are not fraudulently using the donations for personal purposes while skimming the budget surplus from advertising at the same time.
Most game communities are actually fairly small...While I can certainly understand why this happened, obviously there are some large sites that *are* free and don't charge anything, thus proving that it can be done on a larger scale.
The Elder Scrolls/Bethesda community is still very huge. Especially now with the realease of Fallout3. Even Oblivion is still going strong, TESNexus doesn't beg for donations like Kathy did. Many Oblivion modders also use FilePlanet for their uploads.
It would make more sense for TJ to just finish adding to the Blender what it needs.
He would be the most logical to carry on the work but he's also said there's some stuff he won't put in it, some stuff that I know I use the Insim for. But the Blender comes very close to the insim, that's for sure.