I'd like to set up a blog where people can register and add their own posts. (which will be moderated first before going live)

Is this possible with Movable type?

Please note, I do not want to set up multiple blogs, I only want one that other people can contribute to.

A very late reply, but I think the Pro Blogging tools may be what you need http://www.movabletype.com/download/compare-products.html