With the Windows Live Writer (WLW) you can create or open local draft version of a post. but Windows Live writer don't have a feature of editing the existing posted blogs. But I found one plugin which is very useful to edit the existing blog.
When I search for the edit an existing blog post in google, I came across with the below nice plugin.
Download the below plugin and install it on your machine.
Syntax to open an existing blog post is wlw://www.yourdomain.com/?postid=[postid]. Here http should be replaced with wlw.
when you hit above link with your domain information and post id, existing post will open in Windows Live Writer.
Edit existing post thru BlogEngine blog
Under the PostView.ascx user control, add below code where ever you would like to show the "Edit in WLW" link.
<asp:LoginView runat="server" ID="LoginView1"><LoggedInTemplate>
<a href="<%=Utils.AbsoluteWebRoot.ToString().Replace("http","wlw") + "?postid=" + Post.Id%>" rel="bookmark">Edit in WLW</a>