I mean submit your blog to some blog directories,this method could take you some backlinks,and if you creat an blog post,you can submit it to social bookmarks,this also can take you backlink and traffic,and you can exchange links with each other.All these way could promotion your blog.
Yes, definitely blog creation and blog submissions help you to rank better as blogs have the same value as compare to the websites. As compare to websites, blogs are more active and comes with new updates daily.
Yes, understanding the webmaster tools will help you at some extent, also use the All in one SEO plugin which is a great plugin created specially for wordpress blogs. It has some nice features which helps you to target different keywords via different Titles.