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1.Installing wordpress on your domain is free. Use this - http://codex.wordpress.org/Installing_WordPress It is very easy to set up. 2. I personally use Posterous.(http://posterous.com/) Very easy to use. Has comments too.

I tried posterous but didn't like the themes they provide. Plus it doesn't work for my domain which ends in .info and not .com :(

So far I am loving Tumblr but was wondering what other options do I have.

Well, I do need some hosting. And if I want to host at Wordpress.com, they will charge me 10 bucks a year.