While I agree that it hits too low, Blizzard is far more worth casting when you are dealing with more than 3 targets. On individual targets yes the damage does suck (even when it crits), but when you consider it's doing the same to up to 12 guys it doesn't look as bad. Blizzard is actually my #2 damage source on Cho'gall Normal because it usually hits around 8-10 mobs (slimes or tentacles) on average.
All things considered, though, in this tier of content that's the only fight I use Blizzard on.
I would say more like 5-6 targets is when AoE > Single Target for frost, especially if you can freeze them (piercing chill, ultra procs).
I think it does need a little bit more. Take a look at mind sear for example. Not only does it follow the target, it deals a lot more AoE damage. I wouldn't say that it's ability to slow (requires talent) and its ability to proc (again requires talent..) nearly makes up for the lack of damage and being stationary.
But one awesome benefit you get from blizzard is that it makes for an incredibly easy transition from AoE to single target, especially since if casted on a lot of targets you are guaranteed max procs plus nearly all trinkets that aren't on ICD. This allows you to go into the single target rotation swiftly, but again that requires the talent.
Yes, the value of back-to-back Deep Freezes is undeniable, and it's more difficult to line that and Frostfire Orb up immediately after cooldown later in the fight (they will inevitably fall out of sync), but perhaps you should also weigh that back-to-back Icy Veins during Bloodlust/Time Warp may more than make up for the opening. Frostbolt makes up about 50% of your overall damage and running them with a 1.0 second cast is nothing to sneeze at.
It may be, though, that fight length will play a huge factor over which is better. Fights that go over 10 minutes will favor using Cold Snap early, but I haven't done a fight as Frost that lasted that long (as I don't run Frost on H Maloriak).
Yes you would think that having CS in Heroism/Time Warp phases would be awesome, but i've noticed usually that the amount of control you have during that 50% casting increase is usually diminished, which usually results in a loss of dps. Plus, this guide is more geared towards beginning players (since most of them are). There are a few elitist frost players like myself whom may be able to control it during those phases, but overall i'd suggest the early CS.