Blue is the code name. It remains to be seen what the final branding is, but I doubt it will be called Blue.
It wouldn't surprise me if they "relaunched" Windows 8 if they ship it alongside some new Surface hardware around Q3. The app store has come on leaps and bounds since October, so while it may still be in "third place" it looks way healthier than it did a few months ago. Added to some better (or in some cases, actual) hardware in the shops it might not be a bad idea to focus their efforts between the back to school and Christmas period.