Hi Marama
All sound advice from Linda. I'll add a few pointers which I hope will be helpful.
Firstly, if you decide to start a Wordpress blog, you can import all of your posts and comments from Blogger into the new platform. It's not too difficult although there are potential problems (aren't there always) but the following links will be of help in deciding if it's something you want to attempt.
Importing Content « WordPress Codex
Import Blogger Posts & Comments to Wordpress Easily
These will both lead you to many more discussions on the subject.
Of course, there is nothing that says you have to abandon the Blogger blog and you can always set up redirects so that all your old links will take people to the place of your choosing. The Wordpress Codex is full of questions on all these topics so you might want to have a look at how folks have solved them in the past, including dealing with the potential downsides you have mentioned such as loss of links/traffic/rankings.
If you really feel that you want to move from one to the other, it is better, in my opinion to do it sooner rather than later. If you feel WP is the future for your blog, go for it before you get too "entrenched".
I'm sure Linda is correct and that you can indeed point Blogger to your own domain.
Your idea of just leaving the Blogger blog with a final post giving your new address is something you can do in addition to copying the entire blog over to WP on your own domain.
As I'm no expert on permalinks and redirects I won't go into it too much and make myself look foolish - perhaps someone else can give you more pertinent technical information but the WP Codex above is a great place to start finding some answers.
Good Luck whichever way you choose to jump
Mo