Microsoft insiders (Scott Hanselman) are talking about open sourcing Windows Live Writer, which would be great as the application hasn't seen any major updates since the 2012 product release. Hanselman has also suggested a fix may be a while off--in the hands of the open source community.
Apparently Google is also considering a fix at their end, which would be great to keep us bloggers running in the meantime: https://plus.google.com/u/0/+RickDoyle/posts/GUPJcu5sZHo
Update: a few workarounds have popped up around the web:
- View source in WLW and copy/paste into Blogger (web). See http://mybeerbuzz.blogspot.com.au/2015/05/blogger-windows-live-writer-blogger.html
- Configure posting by email. See http://www.hackinguniversity.in/2015/05/live-writer-not-found-error.html
Update 2 (3 June 2015): seems to be working again as expected :-)