There is a lack of info available on how to use blocks, but I did find an old tutorial for the sample filtref design included with Quartus that provides details on how to use blocks and conduits. I have attached this for reference.
Blocks do have some nice features, such as if you use common signal names in multiple blocks, then when you run a conduit between the blocks, all these signals will automatically be connected together. You can manually select/deselect signals & buses as well. It is also quick to add/modifiy signals on a block, and you can use a block to then generate the template for your vhdl/verilog design file. I think that a block diagram could be useful to provide fast connectivity for a top level module, where the top level simply acts as an interconnect for lower level modules. For portability, you can even generate a vhdl/verilog file from the block diagram. One thing I discovered is that you can't connect the same signal in a block to two separate conduits. Quartus gets angry if you do this, but does not give a clear reason why.