Jeff,
Formation flying with similar aircraft is not really that hard. Any gusts that effect the lead aircraft effect the wingman in the same way. However, formation flight with two different types of aircraft is an entirely different story.
While it initially takes some practice, formation flight eventually becomes almost second nature, kind of like driving beside someone on the highway (admittedly with another dimension added to the mix). The formation the Blue Angels use is called "IFR parade" in the Navy. It is used to allow formation flight in Instrument Flight Conditions (IFR) when visibility is reduced. I have often flown formation where I could only see the very tip of the flight leaders wing. The real challenge when flying this closely is taking care of all the routine cockpit tasks that cannot be ignore just because you are in formation(changing radio frequencies, managing your fuel, helping the flight leader navigate, etc).
Maintaining a precisely balanced echelon formation is kind of intuitive once you figure it out. The second pilot flies to the proper position, usually looking down the wing-line of the lead aircraft. The third pilot matches the spacing and positions his plane so that the flight leaders and the second pilots heads are in a line (which puts him on exactly the correct bearing line). The fourth pilot does the same thing as the third pilot - he lines up the helmets of the other three pilots. The real challenge in this formation is maintaining position during acrobatics.
Flying a good diamond formation is almost easier. The second pilot flies the same formation as before. The third pilot flies the same formation on the other side of the leader and tries to match the spacing set by the second pilot. The fourth (slot) pilot uses the same visual cues as the second and third pilots use (looking down the wing-line of the second and third pilots planes. The shorter "lever arms" involved make this an easier formation to fly during acrobatics.
From an ex-tactical Navy pilot's perspective I find the most impressive part of their routine is how quickly they join up and how quickly they change formtions. Given enough time almost any week-end pilot can fly formation, but they will not approach their leader with over 100 knots of closure then stop in a precisely correct close formation and they won't change formations at the top of a loop.
Mike