Frame blending will look "blurrier", because it is blending the frames together. Turn it off, and the picture will be much crisper, BUT, the motion will be rougher. Because it will just duplicate frames to create the slow mo. So for picture quality, no frame-blending. But, for motion quality you want frame-blending. You can't have you cake and eat it too
Thats one of the reasons why the HVX is such an exciting camera. Now you can have slow-motion effects without having to frame-blend or do any of that nonsense in your software program (unless you want REALLy slo-motion).