I have updated my sitemap and the new one is now based on Niall Kennedy's template that he created. This template outputs the exact same sitemap I had setup before, but that one was using the sitemap generator and a config.xml file along with a urllist.txt file that was outputted using Movable Type. This new template just outputs the XML file straight from Movable Type. The template I created outputs the main index page, all individual archives and also monthly and category archive links in the sitemap.
Here is my latest template:
<?xml version="1.0" encoding="UTF-8"?>
<urlset xmlns="http://www.google.com/schemas/sitemap/0.84"
xmlns:xsi="http://www.w3.org/2001/XMLSchema-instance"
xsi:schemaLocation="http://www.google.com/schemas/sitemap/0.84
http://www.google.com/schemas/sitemap/0.84/sitemap.xsd">
<url>
<loc><$MTBlogURL encode_xml="1"$></loc>
<changefreq>daily</changefreq>
<MTEntries lastn="1">
<lastmod><$MTEntryModifiedDate format="%Y-%m-%dT%H:%M:%S"$><$MTBlogTimezone$></lastmod>
</MTEntries>
<priority>1.0</priority>
</url>
<MTArchiveList archive_type="Individual">
<url>
<loc><$MTArchiveLink encode_xml="1"$></loc>
<lastmod><$MTArchiveDate format="%Y-%m-%dT%H:%M:%S"$><$MTBlogTimezone$></lastmod>
<priority>0.8</priority>
</url>
</MTArchiveList>
<MTArchiveList archive_type="Category">
<url>
<loc><$MTArchiveLink encode_xml="1"$></loc>
<changefreq>weekly</changefreq>
<priority>0.7</priority>
</url>
</MTArchiveList>
<MTArchiveList archive_type="Monthly">
<url>
<loc><$MTArchiveLink encode_xml="1"$></loc>
<changefreq>monthly</changefreq>
<priority>0.5</priority>
</url>
</MTArchiveList>
</urlset>
To set this up on your own installation, simply copy the code into a new index template and set it to output as sitemap.xml or whateveryouwant.xml.