Here's how to setup an alert for blocking in SQL:
By default, the blocking is set to 5 (the minimum), if it's 0 it's disabled. As I understand it, it will report an error for any blocks that last as many seconds as specified. So if it's set to 5, it'll generate an alert when a block lasts for more than 5 seconds.
This MSDN article (http://msdn.microsoft.com/en-us/library/ms181150.aspx) explains how to change the setting. To check the setting, query the master database: select * from sys.configurations where name like 'blocked process threshold'.
This thread explains how to setup the alert (http://social.msdn.microsoft.com/Forums/en-US/sqldatabaseengine/thread/945cab5d-b8eb-4c15-93ff-b4ddbba1f7f2?prof=required). The step I missed when setting up the alert is selecting the Object "SQL Server:General Statistics" Counter "Processes blocked". Set the desired response and it's ready to go.
I'm now waiting to verify that my alert is functioning properly.