I'm afraid it comes down to blockland not being "indie" enough
Add in a bunch of looping chiptunes and pixelate the hell out of everything with custom shaders.
I think Blockland just needs better advertising and to be on steam. Minecraft did incredibly well on steam along with a bunch of other indie games like Portal.
I think the question of "Why isn't Blockland on Steam?" is a lot more complex and interesting than it sounds.
There's a number of other issues to consider before putting it on steam that I can see. Some things just aren't going to scale nicely when you start throwing tons of users at it. For example, the servers page on the site would be pretty much unusable (although I don't know how much it's used right now anyway). Both the authentication server and the master server would have to be able to deal with the larger volume of traffic, this is an issue that's brought down other small indie games too. There's also a certain percentage of the income that goes back to Valve. New game keys for the steam version would be pretty simple, you'd get the key popup like you do on other steam games and could just copy/paste it into the authentication box. I don't know how non-steam keys would work though. There would either need to be a separate stand-alone client (which several steam games have, off the top of my head, mount&blade), or you would need to be able to redeem your old key through steam (pretty sure valve only does this for valve games though), or there would need to be a demo version on steam that you could also enter your key into. Being on steam also doesn't guarantee success, there are a number of indie games on steam that didn't sell very many copies. When we think of steam we remember all the indie games success stories like Super Meat Boy, and probably forget some of the other games like Zero Gear that sold well at first and then petered out, despite being a good game. As far as I know, all the multiplayer servers for Zero Gear are empty. Blockland would probably avoid this fate though, it's already got an active community and plenty of players.
On the other hand it does simplify some things. Steam can handle all the monetary transactions, foreign conversions, etc and Badspot doesn't have to deal with international money orders coming into is PO box anymore. It also automatically collects sales information for you so it's easy to see how many copies you sold and how much money you made. You get all the publicity that comes with being published on one of the largest game markets in the world. You would also be able to take part in the indie bundles and random events steam does, like the whole potato sack thing. The advantage of being in something like the potato sack is huge, all the games in it sold really well (at a discount of course) plus they all got featured on practically every gaming website in the universe.
Finally RTB wouldn't need to maintain the chat anymore, nor would it need to implement that gallery system that's been proposed, since steam now lets you throw 1gb of screenshots up on your steam profile. However; that's not really anything Badspot would benefit from, beyond the fact that now everyone could chat with their friends and they wouldn't need a mod to do it anymore.
Poll