I know that WordPress features private blogs, but people whom you want to share it with need to have a WordPress account.Is there a blog hosting site that requires only an e-mail address for access to private blogs? For example, I want to write a blog to give updates to friends and family. All I should do is invite them to my blog, create a user account for them, then all they have to do is log in with their e-mail address (and their own chosen password, of course) to be able to view my blog.
Private blogs for which invited guests don't need membership to the hosting site
email;blog;invite
If your family and friends have gmail accounts, in Blogger.com I think you can configurate it as you say, go to Settings -> Permissions ,  set Who can view this blog? to Only people I choose. And add the gmails. You can setup many other things, blogger admin gives quite some options. They wont need to setup a new blogger account.