Depending on how you want your blog to work (say you want to serve ads, or some other feature) you'll get stuck unable to do what you want with wordpress.com. [1]
Self hosting WordPress is usually a good option but if money is a problem it will mean more work managing your install, if money isn't much of a problem take a look at the many managed hosts (wpengine, wpsynthesis, zippykid).
You also get more options with theming and plugins if you host WordPress yourself.
If you just want to blog, a free wordpress.com, a blogger blog, or a tumblr should all serve you well enough.
You might want to invest in your own domain name though, as *.example.com isn't the best way to bring people in.