I have tried out Blender and Milkshape 3D, but my question is mainly asking if there is any 3D animation/modelling software that is open source, free, or has an indie license available that is widely used by indie developers?
I really like Wikipedia's comparison articles; the Comparison of 3D computer graphics software article is particularly relevant to this question.
But Blender, by far, is the most widely used free 3D software, and I do believe your second choice, Milkshape, would probably be the second most popular. I enjoy Milkshape myself because of the ease of implementation of the MS3D format.
I have mentioned it in another thread here, and I will mention it again: If you need a free Z-brush alternative, get Sculptris:
Wings 3D. Great tool for modelling. I found it easier to learn than Blender and I managed to get shapes I wanted reasonably fast.
Blender fits all of those requirements. Perhaps specifying why you are looking for something else might help people direct you better. By and large though my experience is that people use blender. I had some experience with a little modeler called Anim8or before I moved to blender and I can say it eased me into the 3d mindset.
Not really (other than Blender), granted I'm sure more than one indie team has acquired Maya or Max through less than legal channels, but thats a horse of a different color. There are a few free tools that are closer to ZBrush, but I can't find the names now.