Better to block the IP address rather than the name
The problem with blackholing DNS is that many cyber-crooks know about it and they therefore change the domain/subdomain they use frequently. Thus if you just block certain domains - even if you update the domains from malwaredomains.com frequently - you will fail to block the malware for long. A far better approach is to block the IP addresses of the malware providing hosts because typically the crooks use the same host with the same ip address, they just change/add new dns links to it.
As we mentioned on our blog (er yes this is a commercial plug) a few months back - http://threatstop.wordpress.com/2010/05/10/iframe-droppers-and-other-drive-bys-how-threatstop-protects-you/ - we provide our subscribers with frequently updated lists of known bad ip addresses that may be quickly and automatically plugged into the firewall and which block many malware sources. I'd love to say we block all but then you'd know I was a lying marketing droid instead, I believe we stop most of them though but since the crooks unaccountably refuse to give us a list of compromised hosts for us to check against I can't prove it.
MichaelC above would certainly benefit from our system since stats we have analyzed from DShield indicate that about a third of all threat sources change in a week (and about a quarter in less thna 24 hours). Thus by uploading new data once a week he will be missing a significant portion of the threats he thinks he is protecting against.
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