Keep main articles and author blogs seprerate, News / Magazine like site

That is the perfect use case for a multi-site setup. Users are shared, so your authors don’t need more than one account, and you can activate plugins on a per site basis.

An example: For the main blog you’ll need something like Edit Flow. On the author blogs this would just get in their way. It is also easier to handle theme variations with child themes for each blog in multi-site.
However, a shared media library for all blogs will be rather difficult.

Taxonomies (like categories) are not made for your case: Each post may be associated with multiple terms, and it is rather difficult to force authors to use just one. Setting up proper permalinks requires some tricky extra work too.

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