Free screen capture tool that has decent annotation
Solution 1:
I just downloaded the Snagit Beta for Mac, free for now, I'm sure it will cost when it comes out of beta. So far it has everything I was asking for except the dimming feature. It has a few other nice features as well.
Solution 2:
LittleSnapper (not free) from Realmac Software does these things plus it has organizing features and web capture features, with source code.
It's more suitable for web or other type of designers, perhaps, but it has these annotation features.
A free tool for fast annotation (although I don't think it has darkening or blurring) is Skitch (mentioned by others here as well) which is otherwise very convenient for fast operation.
Solution 3:
Voila can apparently do all that but it’s not free.
Skitch i use most of the time to add arrows and such. Very good.