mhansen - 6:29 pm on Jul 16, 2012 (gmt 0)
I block all tags.
Same here. We go a step farther and also create landing pages for each category as well, then noindex the Wordpress generated category pages also. We view auto-generated pages like WP categories and tags as pages for users who are already on the site, not to be indexed in search engines.
For tags, if the tag seems to warrant a page of its own that needs to be indexed, I will create a landing page, then wp_query all posts with that tag.
As far as the actual landing page goes, I just use a WordPress "Page", then use a "custom field" and some hand-rolled code in the functions.php file to drop in the catid or tagid.
My feeling is that bit of text needs to resolve to 1, and only 1, indexed url. I have no data saying that its better one way or another, but its my own pref and works for me.