I prefer to do it the other way around. What level of buy-in do they prefer? Then set the blinds to allow for good poker in that range.
In my micro game, the typical buy-in is around $40. People come for anywhere between $20 and $50.
This works well for a 25c big blind - a $25 buy-in is 100 BB, which is a decent working stack. A $40 buy-in is 160 BB, which allows people to play hands and lose a bit and still have a playing stack at 100 BB. The further below 100 BB you get, the more you need to start adjusting your play based on being short.
Buying in for $100 at a 25c BB is pretty deep - 400 BB. We don't have a formal max, but nobody has tried to abuse things. The most people have been in for are $120 (six buy-ins of $20) and $140 ($40 and then $100). To be honest, with my crew, most wouldn't mind. If the 400 BB stack tried to bully, they'd just tighten up and take turns calling the big stacks money off... but if that happens often, it makes for disappointing poker, so it wouldn't be welcome.
If your players are only comfortable buying in for $20 max, I'd get nickels and make it a 10c/20c game - that's only 100 BB. I'd rather not play 25c and have everyone starting short with 80 BB.
Yes, 25c/25c is a very common micro cash game.
I run a 12.5c/25c game (my Two-Bit Poker game)... I use an NCV chip for the 12.5c - half a quarter, or one eighth of a dollar, is one bit.) We like the bits better than playing 25c/25c, and find nickels are more annoying (and you need more at the table than you do bits.) I also run a 25c/50c with a typical $50 buy-in; also common micro stakes.