Yeah, but this sounds more like social media than the blogosphere.
Blogs were always effort to set up and maintain, even if you were just going with one of the hosted platforms rather than self-hosting.
And comment spam was certainly an issue but, firstly, systems for dealing with that became pretty good. And then, outside of major news sites - I'm thinking particularly here of BBC's HYS, but the same applies to other news sites - and other sites with very broad interest bases, you didn't tend to get loads of nasty or toxic comments on blogs. Plus, the moderation tools were - as previously mentioned - pretty decent. A lot of the bigger news websites did close comments, but I'm not so aware of this being an issue with blogs which were often more focussed around a particular community or interest anyway... just publicly available.
I don't think the quantity of people online in itself had anything to do with the "death" of the blogosphere. It's just that most of those people don't read or write blogs. And it's become harder to find blogs and other long tail content because search results are now so heavily skewed towards paid results and commercial entities who invest huge amounts in SEO.
FWIW I also think you're probably going a bit far with the moral pronouncements on those 7 billion people: neither you nor I have any real idea what the vast majority of them are actually like as human beings. Moreover, I'd suggest that writing off most people as "[not] very good" or branding a critical mass of them as "spectacularly awful" - and especially when you're speaking from a position of ignorance - is exactly the kind of rhetoric that's landed us with this grim tribal culture that permeates large areas of online - and offline - life.