http://www.earlychristianwritings.com/text/irenaeus-book1.html
"3. The Nicolaitanes are the followers of that Nicolas who was one of the seven first ordained to the diaconate by the apostles. They lead lives of unrestrained indulgence. The character of these men is very plainly pointed out in the Apocalypse of John, [when they are represented] as teaching that it is a matter of indifference to practise adultery, and to eat things sacrificed to idols. Wherefore the Word has also spoken of them thus: "But this thou hast, that thou hatest the deeds of the Nicolaitanes, which I also hate."
What was going on there has analogies/parallels today (in differing degrees of direct comparison, I suppose). Think of the Priest's sexual seductions of alter boys or protestant preachers who use their leadership influence to gain women/sex, (even married women), etc. You can read Irenaeus' description at the link above. Basically, it was abuse of their power by the leadership (false leaders, even demon possessed) for their own personal gain (sexual or otherwise) in teaching and participating in all kinds of prohibited practices. They basically taught that since they were so great/powerful, they could commit adultery/fornication, etc. but that the rest of the people couldn't do this, yet. That is, not until they became "perfect enough" to do these things without harm. Yeah, right! And guess how that reached that perfect level of knowledge??? yep, giving them money/sex/etc.
Chapter VI:3. Wherefore also it comes to pass, that the "most perfect" among them addict themselves without fear to all those kinds of forbidden deeds of which the Scriptures assure us that "they who do such things shall not inherit the kingdom of God."
For instance, they make no scruple about eating meats offered in sacrifice to idols, imagining that they can in this way contract no defilement.
...
Others of them, too, openly and without a blush, having become passionately attached to certain women, seduce them away from their husbands, and contract marriages of their own with them.
Others of them, again, who pretend at first. to live in all modesty with them as with sisters, have in course of time been revealed in their true colours, when the sister has been found with child by her [pretended] brother.
As for "the blood", it's my understanding that there were some of these so-called "most perfect" Nicolaitian leaders/bishops that basically used a magic show/festival of a sorts to influence people into thinking they had miracle powers using blood (animal or human) mixed with wine in a communal cup past around. 'Drink this and you too can be enlighted like me' (type of thingy). Reminds me of give me $100 and I'll send you a magical prayer rag in the mail or Jim Jones or something. Irenaeus and other church fathers said they were demon possessed.
Chapter XIII:2
Pretending to consecrate cups mixed with wine, and protracting to great length the word of invocation, he contrives to give them a purple and reddish colour, so that Charis, who is one of those that are superior to all things, should be thought to drop her own blood into that cup through means of his invocation, and that thus those who are present should be led to rejoice to taste of that cup, in order that, by so doing, the Charis, who is set forth by this magician, may also flow into them. Again, handing mixed cups to the women, he bids them consecrate these in his presence. When this has been done, he himself produces another cup of much larger size than that which the deluded woman has consecrated, ) and pouting from the smaller one consecrated by the woman into that which has been brought forward by himself, he at the same time pronounces these words: "May that Chaffs who is before all things, and who transcends all knowledge and speech, fill thine inner man, and multiply in thee her own knowledge, by sowing the grain of mustard seed in thee as in good soil." Repeating certain other like words, and thus goading on the wretched woman [to madness], he then appears a worker of wonders when the large cup is seen to have been filled out of the small one, so as even to overflow by what has been obtained from it. By accomplishing several other similar things, he has completely deceived many, and drawn them away after him.