I have done the obligatory search and can see most MNers prefer inside the recess, but I was hoping for outside (hear me out!). Now I've thought about it properly I don't think it will work though...
I live in a Victorian cottage. Windows are double glazed, but I worry blinds inside the recess close to the glass will cause damp/condensation and make the blinds go mouldy. So I was thinking outside the recess allows for more air to circulate preventing this. Does that make sense? Also, our windows are not very big, and I would be blocking a little less light by fitting outside the recess.
Problem is, our windows are framed with wooden edging outside the recess, so surely this will make the blinds stick out, preventing them being flush from the wall, and allowing more of a draught/radiator heat to creep up behind it?
Any wise words/thoughts on my best method of action? I don't like curtains, I really, really, really wanted Roman blinds, so I don't want both unless someone can show me theirs to allay my fears of it looking too intense 
Photo of window attached to show what they're like.