Umm, what he said...
My own goals are pretty basic - I try to write a story about a game I'm involved in and make it as close as I can to the quality of a novel. All the rest is details.
Oh, you want some details? Hmmm. Let's see - I personally like shorter, more frequent updates. My own tend to run 3-4 pages in Word before I post them. Most of my posts in my current Story Hour (see sig) are a little over 1,000 words. The most recent was a extra long one, and it hit 2,000.
Punctuation and grammar are critical. So is formatting - break up your paragraphs so tehy don't run on forever. It makes it much easier on the eyes. I think that is probably more critical on the 'net than in a regular novel.
Don't worry too much about getting your game exactly transcribed onto the page. I jot down really good lines as I go - it's easier for me in my current story hour (did I mention it's good to pimp your story hour?) since I'm a player. When I was writing and DM'ing it was a little tougher to do that - sometimes you can get one of your players to log good quotes, or take notes on events in fights.
Some folks tape their sessions and actually transcribe them - I think that's cool, but a lot of work. I have a small digital recorder that I'm planning on using from time to time, but only for important conversations - I'm 3 sessions into my Story Hour and haven't really missed it.
Little extras can be nice. Sepulchrave would write a portion from the perspective of the villains; (contact) has added sketches to his story hour; Piratecat has had a number of people do art work based on his SH. Pogre has shots of the mini's on the table as the game is going on. I've posted maps and such in the past for my SH; I haven't really thought what I might do for the current one...
Oh, and while I joke about pimping my Story Hour (sig!), I think there are some unwritten rules. It's fine to link to it in your sig; it's fine to mention it in threads like this one, or of course in the Story Hour Sampler thread. It's fine to bring it up in other forums if it seems particularly appropriate to the subject at hand (I'd link to it if a thread on gaming in Victorian England or alternate Earth came up, for example).
The only real big taboo is posting in some one else's Story Hour and saying "Hey, read my Story Hour!" That's kind of bad form.