I hope someone is still following this thread. 

  My blocking philosophy is as follows:  As the director reads the script he/she will visualize certain "stage pictures" in his mind at key points in the show - at least one or two per scene and probably more.  These are mental images of just how he wants the actors on stage to be placed at a particular point in the show. I will even sketch in the margin of the script (in pencil) so that I remember.

Now, blocking is what you must do to get all of the actors from "stage picture" #1 to "stage picture" #2 and so forth. By starting out this way, you can allow your actors the freedom to help devise ways to get from 1 to 2. They just have to know where they were and where they are headed.  This method has really helped me organize my blocking by giving me numerous way-points along the path.

I block every single movement in my junior high play (you have to teach them to use their imaginations).  By the time they get to high school I put them into positions for stage pictures, but I generally let them work out the poses.  I do it like dot-to-dot.  I go through the script and put a star next to lines where I think we should have a stage picture--the moments that reach out and grab at you).  Every French scene of at least 2 pages in length should have at least three.  Then I use the motivations from the lines and actions of the characters to move them from one place to another.  Usually it takes three to ten blocking directions to move from one stage picture to the next.  NOTE:  Never have an actor move unless you would be able to tell him why he is moving.

When I was first developing my blocking skills, I would depend on my visual thinkers in my cast to help me out.  I'd get the kids to a stage picture, have them freeze, and then have the visual thinker step out and try to improve it.  In subsequent years I'd have them help choreograph songs (and we're not allowed to do traditional "dance" on stage at my school). 

Go watch theatre of good visual directors!  Go see anything you can.  Pay attention, draw sketches of stage pictures that interest you, take notes during intermission and after the show about what worked and how you could use it in the future.

I have a book at home that's red.  It's called _A Primer of Stage Directing_.  It's really old, and probably out of print.  It's was published by Samuel French in the 30's or 40's.  It's a very, very good book.  Try looking in bookstores in college towns.  When professors retire, they tend (or their wive's tend) to donate their old books connected with their profession.  I've found some excellent old text books that teach the basics in easy-to-understand language that way.

Never show up to a rehearsal without some idea about what you are doing with blocking. We usually start a blocking rehearsal by having the actors gather around my desk.  I give them their blocking notes for a French scene or two, and then they run the scene with their blocking.  I like to run it twice and then move on, but sometimes we only have time to run it once.   We also set up a second area so actors who are waiting to work with me can review their lines and blocking on a stage with the right dimensions.  I know most people don't have this luxury, but even setting up a partial stage in a lobby or foyer can help jittery actors.

I have my students number the lines in their scripts, starting with the first line at the top of the page (even if it is just a continuation of the line at the bottom of the previous page).  Then, when I give blocking, I say, "Line 3 at the beginning, Mortimer crosses stage left above the couch and turns 1/4L, leaning in a pose on the back of the couch."

For keeping track of it in some semblance of order, check out stage management books on how to set up a prompt book.  Every book also has a section on blocking notation.  If you go on line, you can download the way dancers notate blocking.  This is more complex, but can say so much in such a small space.