Avast didn't report anything, so it looks like you got rid of the code.
I still highly recommend changing your password, and strengthening it while you're at it as well.
Since it's a hosted blogspot.com site, you shouldn't need to do any security updates, but you might be able to update your blogspot software from within it's console.
Again, I don't use blogspot and never have, so my terminology could be completely off.
In any event, where did you find the iframe code? was hiding with other banners of blog directories
Nevermind, you answered that while I was posting. Cool, sounds good. You should mark this thread solved by modifying the original post's subject with (Solved) in it. Oh, and putting "it WAS true" too...