If Bob has a personal blog, he cannot share ownership (or editing rights) with any other users (except for system admins who can view any content). In this case, I believe you will need to convert his personal blog (Bob's Blog) to a system blog (Bob's New Blog) and then enable Karen to be a co-editor of the system blog. So long as Bob starts the blog post and gives the draft a proper title, Karen can edit and there will be no obvious record that Karen has made edits. I learned the hard way that blog titles are hard to change since they are included in the URL.
To have co-editors on a blog, you will need to create a system blog for Bob and then move all past personal blog posts to that new system blog.
Otherwise, you go "old school" and collaborate on a document and then have Bob post the finished product.
Anyone else have other ideas?