Here's how I got it going:
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In the blog settings, enable "show feed links" and save
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Right-click on the RSS icon, and copy the url shown (e.g. http://yoursite/blog44rss.aspx)
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In your feed manager instance, click the "Add/Edit Feeds" link
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In Feed URL field, paste the URL from step 2.
That should do it. You can then play around with settings of both the blog and feed manager instances to change how the feeds are displayed in feed manager.
Jamie