This looks like a really promising plugin. The trouble I'm having is that the widget doesn't seem to update itself completely. When a new article is adding to a blog, it appears in the list of posts. However, the order of the blogs doesn't get updated.
I'm wondering if it has something to do with blogs being excluded from the list. Initially when I set up the widget, I chose all but one blog to appear in the list of recent posts. When I updated one of the blogs, it went to the top of the list of blog in the widget, but my excluded blog then became second. It is not currently possible to select multiple blogs from your list if they are not in consecutive order. Hope this makes sense - again, I'm just guessing as to what the problem might be.
Adding a separate feature to exclude blogs would be pretty cool. :)
Would also be nice if you could include a shortcode or instructions for how to insert the function directly into a template.