I came around this issue closely about 24 hours ago. And I went to the official blogger help forum and already few people had posted about the issues and the problem is still not fixed. The issue is that you cannot remove, change or add the XML in blogger.
|Clear Edits, Expand Widget Templates... nada .. nothing works!|
Not quite sure how everyone is affected but when reading through some of the errors that people get, starting with java-script errors to "freeze-ed" Save template or preview buttons... it is pretty major you bet!. For instance if you have a site that gets a lot of traffic and was in the middle of fixing something then this is certainly not good news :(.
You can't switch between templates either. But interestingly you can change colors or fonts, etc via the new template editor nonetheless. But can't edit the XML manually.
So if you have the same problem please use the above link and post your "complain" and try to give information such as your blog name, web browser, etc for better trouble-shooting. And few hours ago Google official blogger team member did notice the issue finally and said they're working on the error and will fix it pretty soon. Until then we can't do anything but wait (painfully I might add).