I decided that ripping out the sleeve and replacing it was a bit silly. The sleeve works just fine. I will be testing out a new sleeve in blouse 3.0 when I can finally get to it. The collar, as mentioned previously, worked up just fine and worked better with the 1/2 inch neck seam allowance. The wrinkles in the blouse are just from my dorky pose, as it fits just fine. The new bodice pattern is more fitted and flattering than more boxy version of the white blouse.
When DH first saw this print, he said it looked like a grandma print, but he changed his mind when he saw it all finished up. The fabric is a quilting cotton from my stash.
And this is how I wore it. The cardigan is the one I bought at the Goodwill and and fixed up about a month ago. It has quickly become a favorite.