According Inside-Adsense, Blogger now had implement feature to insert Google ads between your blog posts through the AdSense widget.
Here's all you need to do:
1. Log into your Blogger account at http://www.blogger.com .
2. Visit your blog's Template tab and click on the Page Elements link.
3. Click Edit in the Blog Posts section.
4. Check the box next to Show Ads Between Posts. You can then select how often you'd like your ads to appear, such as once after every post or once after every other post.
5. Customize the ads and click on Save Changes when you're done.
Please note that right now, it's only possible to insert Google ads using this widget, and not AdSense for search boxes or referral units.