@turquoise-- I have one too! I've been soaking my nipple in warm water with Epsom salt. A friend told me about this remedy. I've only been doing it for two days so I'm not sure if it's working. But it does help relieve the pain and irritation a little bit. You might want to give it a try.
It doesn't have to be Epsom salt, you can use regular salt too. And it's also a good idea to apply a warm compress on it, especially before nursing. Apparently, a milk blister will usually open up by itself if this is done regularly. As an ointment, I use a vitamin E ointment.