Can I blur the edges of an image?

You can use Cloudinary to apply overlays and masks as explained here.

Here's an uploaded semi-transparent PNG file to make the edges more smooth.
http://res.cloudinary.com/demo/image/upload/square_feather.png

And here's a sample result using the semi-transparent mask with the cutter flag:
http://res.cloudinary.com/demo/image/upload/l_square_feather,fl_cutter.relative,w_1.0,h_1.0/couple.png

Final step, you can add the same image as an underlay with the blur parameter:
http://res.cloudinary.com/demo/image/upload/l_square_feather,fl_cutter.relative,w_1.0,h_1.0/u_couple,e_blur:500/couple.jpg