the idea of asking someone is great, but the simple question still remains "why would they be interested" if i am not an established blogger why would they even think of guest posting and $100 or $200 are not even close to what they earn in a single day
Not all established bloggers make money from their blog. As I said in the post as well, you don't want to ask the top tier writers. You want to go for the middle level guys who are more open to the idea.
For me the problem was not asking for money but they were asking "Your site is totally new & you should first build some credibilty or links & increase your PageRank (toolbar) then we'll definitely write a post on your site." Now how to tackle this issue?
if they want more notoriety, I'll offer to advertise their post on Facebook and Stumble upon in addition. These ads are inexpensive and will help your site out as well.
This is really good stuff!
Great! Head over to login and use your credentials there