I use Lite Heat and Bond and a Blanket stitch on all my applique work. I think perhaps you may be using such a tight satin stitch that it is quiet literaly cutting the fabric.....If I don't want my blanket stitch stiff, then I window cut the bonding material, some times I like this look, some times I don't. I think we each do things just a little differently than others, and thats okay !!!