There are many blogs out there that are currently blogging about Wordpress and the Duplicate Content issue but few actually provide solutions and help you overcome this problem with your Wordpress installation.
However Lovedeep Wadhwa has 5 easy solutions for you (and me) with his post Wordpress Duplicate Content Issues & Solutions
an excerpt:
1. Excerpts on Homepage: Displaying post excerpts instead of full posts on the Homepage can solve the problem of duplicate content on homepage.
2. Use Robots.txt: We can tell google bot not to index certain parts of blog that contain duplicate content, like website feed, archives and category pages by creating a robots.txt file.
See my robots.txt file for an example.
3. Use the www preference plugin : This plugin can help us to preserve permalinks by enforcing no-www or yes-www preference. For Ex: Whenever someone tries to access website from http://domain.com will be redirected to http://www.domain.com
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Currently I am doing all three.. Also, I am using a plugin to prevent crawling category pages to prevent duplicate content