With this question, do you mean the dragon's literal, physical blindness, or figurative blindness, as in its greed and obsession with the treasure? The reason I ask is that I scoured the text again last night and I can't find anything that says the dragon is physically blind. There is even one line that says he saw the footprint of the slave who stole the cup from his hoard.
I think, though, that the dragon is a warning to the Anglo-Saxons. Throughout Beowulf the poet gives examples of men who graciously share their treasure - the ring-givers - and they are held up as examples of noble, generous, good men (Hrothgar and Beowulf are two of those). Those who do not share their good fortune with their retainers are scorned and always come to a bad end. So it looks to me like the dragon is the ultimate example of what greed will do to a person. He exemplifies a life of ugliness and selfishness, left all alone with this hoard of treasure that he really can't do anything with - and he certainly can't take it with him when Beowulf comes and kills him.
Concerning your "P.S." - YES, what a perfect name! One of my students recently got me hooked on the Irish punk genre, especially Flogging Molly, and I think "Blind Dragon" would make a perfect name for an Irish punk band! :)