First, I am sorry to hear about the disruption to your site, but relieved to hear (if I understand you correctly) that the posts and all your content are still safe on the server.
To get to the bottom of this let's agree to use two standard terms: "blog" for the whole collection of posts that are published on your site, and "blog post" for an individual entry on you site. When you say you deleted "the blog" in MarsEdit, are you alluding to deletion of the whole blog or just a blog post?
Deleting a whole blog from MarsEdit NEVER deletes anything from the server, it is only a removal of the configuration from MarsEdit.
Deleting a blog post from MarsEdit DOES delete the post from the server, only after asking if you are sure and clarifying that there is no undo for that. I should update that text to be even more clear that the post will be unpublished from the site.
The good news is, even when a post is deleted from the server, it should show up in the "Trash" in your WordPress admin panel, until you choose to empty the trash. If I am on the right track about what has occurred, will you please look in the Trash? It's a category link at the top of the posts list, where you said you had found your older posts.
Daniel
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