Josh:
I know the cafe isn't a huge money maker and your business model doesn't warrant a full time employee for the site. I also am lacking in some basic information about your system and capacities so I'm sort of going blind here. But clearly there is a consistent problem with mega-spam.

It seems you are balancing two competing needs which are: the need to allow people to participate and the need to maintain control over content in regards to spam. The spam problem appears to stem exclusively from the fact that accounts have auto-activation that immediately allows new users to post diary entries en mass. The key is to find a way to curtail this while still making it convenient for people to sign up to comment, as well as to find a solution that does not significantly increase overhead to the staff. It seems to me that the site doesn't add *that* many new legitimate diary posters in any given day/week.  You should consider limiting the ability for new users to post diary entries without approval.

This is the first wordpress plugin that popped up by searching for "wordpress blog approval" on Google. It may not be the best for the task, but it will work fine to describe what I'm talking about. The plugin (called "GT post approval") advertises that it allows administrators to approve/reject posts, and to set an access level for auto-approval of posts. An imaginary operational policy would go something like:

1 - All current posters set to auto approval level
2 - All new posters have their posts drop to the approve/reject que
3 - After the user makes their first diary entry that is obviously serious, set their access level to auto appoval level.
4 - clean out all the spam with a simple click of a reject button
5 - delete spam producing accounts (optionally, block the IP)

This would block the diary entry spam while not interfering with people who want to sign up and comment immediately. It would also allow you to manage the approval/spam removal process as a scheduled task that can be budgeted in a (reasonably) predictable fashion which would likely take some of the uncertainty out of managing the cafe. I can't imagine that it would take more than 15 minutes for an employee to go through and approve/clear out a decent list. Depending on available resources, if you were able to do it twice daily there wouldn't even be that big a delay for new members.

Anyhoo, that's what I'd tell you if you were a client. :-)

And yes, I'm post-timing this for around 10am tomorrow because we're in the midst of a new spam attack ... and putting it on muck and dc even though it's meta 'cause I'd like management to see it.