Another blog is already hosted at this address - Custom Domain for blogger

If you purchased google custom domain for your blogger through Google Apps, but end up getting the message "Another blog is already hosted at this address" then here is a quick solution. At least it worked for me to fix the error message Another blog is already hosted at this address from this post on google groups.

When you purchased your custom domain from google, you will have
gotten an email from google apps, telling you that you now have a free
account with your login information.

Login to google apps.

Once you are at the control panel for your site, you'll see a link,
near the bottom of the page called "web pages" or something close to
that. Click on the link.

You then see an option to disable webpages. Do it. Disable the
webpages.

Then wait for about half and hour (the hardest part).

After 30 minutes, go into your blog's publishing settings and try to
assign the custom domain. It should work (at least it worked for me).

What happens is, google (in their infinite wisdom) gave you a whole
bunch of webpages like calenders and landing pages and crap like that,
which you of course don't need because you already have a blog. When
you go to assign your blog to the domain you just bought, blogger
looks at the domain, sees all the crap that google installed for you,
then thinks that someone is already using that domain. By disabling
the webpages in the google apps settings you are effectivly removing
all the google junk

This one helped me; hope it does for you too.