Seems like a good idea, but only if the quality was really worth it. The cost, even on newer cards, would be quite a penalty. For something like wax, I could see it being worth it, but the scattering in skin simply isn't "deep" enough to warrant something like that.
The method I use is sort of similar to what you described in that last part. I use deferred shading so rendering an object again (or once per light) is impractical. Therefore, I fill the g-buffer and store the material information. Then I perform lighting like I normally would for any object on the SSS surface.
After all the light accumulation and before the light application to the scene, I read from the material buffer and use that to mark the stencil buffer on the pixels that need subsurface scattering. Then, during the light application pass (blending it with the scene), I did what you discribed, which is a screen-space blur on only the places marked with the previously mentioned stencil pass. Note that I apply the diffuse textures after I blur the light.
Finally, I apply the blurred SSS light with the sharp regular light for the rest of the screen. I do a gentle blending with the unaltered sharp light on the SSS surfaces to keep their edges from getting too fuzzy.
EDIT: btw, it should also be noted that I keep the specular in the a channel of the illumination buffer and do not blur this with the rest of the light.
Its not a full proof method, but for the fairly cheap cost I think it gives pretty good results (this is running at 78 fps on an 8800 ultra):