The blood would be well accomplished by my goblin-dropping idea, I think. Sorry if I seem to be pushing this a lot, but I think it would be really awesome.
In addition, perhaps you could have chained megabeasts surrounded by magma moats to ensure safety. Or chained goblins. Hmmm, this could be really epic. What I'm thinking is several "islands" surrounded by magma with chained goblins on them. Bridges from the mainland can connect to the islands for delivery. No-quality upright spike traps surround the chains, and they are activated by pressure plates in the entrance. Whenever dwarves walk in, they will be greeted by the joyful sight of screaming goblin scum being impaled on spike traps. (Is there some way to have scourges or whips activate on command? That would be better.)
Also, at the very end of the temple, you could have a huge lake of magma. Above it, you would have a large room with two bridges, each about half the room's size. These would be filled with cats - the only ones in your fortress. Each year, you could draft all the dwarves (or Armok-worshipping dwarves - just choose a popular deity to be Armok, like Ber Steelearthens was chosen) and send them to watch the ritual to blood. The High Priest pulls one of the levers, and half the cats are dropped into the magma. Immediately afterwards, the High Priest pulls a different lever that unleashes 30 goblin wrestlers into the middle of the crowd. Those who die are thrown into the magma. Those who live are celebrated as the chosen of Armok. Indeed, you could have custom job titles or something. Live through one ritual and you become a Servant of Armok, live through five and you become a Priest of Armok, live through ten and you become one of Armok's Chosen, etc.
Waterfalls, that's good. You could have a gauntlet. Goblins are released on one end; to get out of the fortress or to dwarves, they have to run through a long hallway. First they are doused in a magmafall. Then they have to run through a long hall with several scattered 1-scourge weapon traps and maybe some novice marksdwarves to pick off the unlucky. If they live, they are beaten down by the worshippers. This might set all your Armok worshippers on fire, though.
Another thing, maybe you could have a long 1-tile-wide hallway of goblins in your dining room? You might want to seperate them with fortifications so they don't clump up, like this:
WWW
WGW
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And so on. Anyway, the walls would be made of glass, and all the dining tables/chairs would face it, so dwarves could laugh at the goblins. To resupply, you could have a pit/bridge combination like Retro did in his tower. Then you'd have a ballista at one end, and every time you wanted to celebrate you'd fire it repeatedly and kill off all the goblins in a shower of blood. Even better, you could make the sidewalls fortifications, so that the blood would spray out onto the dwarves! It'd be like a water show, ponchos required. Also, it would be a good idea to have a channel at the end to drop the ammo in without using it, so you don't have to churn out tons of adamantine ballista arrows or whatnot.