I've always wondered about this, too. My machine has a stitch that is supposed to be like a blanket stitch, but it looks like the stitches are slanted. I think that would look funny for applique. I don't know how I could adjust the machine to get them to go straight. I always figured I needed a different machine to get a true blanket stitch, but I've found not a lot of machines have that – most have this slanted stitch.