It looks like a fairly standard terms of service to me. You could try a different blog software but you would probably still get it there.
As long as your blog doesn't attract nutters with a persecution complex or is actually really offensive, and I doubt anyone on opium_lips' friend list would be that offensive, you will be fairly safe. Actually even if it does get the aforementioned nutters I think the LJ staff would see them for the nutters they are.

Also if you pissed off about this you may want to check your ISP; I know optus has the same clause on my net access and I've heard of others in the same situation too.