Just one extra little tip that may make the world of a difference. It did it for me. Set your machine on straight stitch and take 5 or 6 stitches along the edge of your applique piece. Change it back to blanket stitch. Stitch the blanket stitch all around, even over th area that has the straight stitch. When you are done with the blanket stitch, change it back to straight and take a few straight stitches on the edge of the blanket stitches. Your start and end will be secured and it will never fray. It takes a few changes from straight to blanket, but worth it. What machine do you use? I use a bernina and with the Temporary Altered Memory your blanket stitch goes back to the size you selected initially.
Maria