How to dodge the blue shell in Mario Kart Double Dash
A properly timed mushroom/boost may get you out of the blast radius.
If you're in 1st, hit the brakes hard whenever you hear the sound of a blue shell from anywhere. If you're lucky, you'll slow down enough to let someone pass you in time, at which point you simply need to keep a short distance between yourself and the new 1st placer until they get pwned by the shell.
Try to keep out of their blast radius.
I've had one where it zoomed at me just as I started up a small hill/bump, the shell missed me due to my upward movement and it instead went through the ground. The funny part is that the shell was still visible going off into the "distance" beneath the ground.