I don't think you have created a mess at all. The way you described is different than the way I know, but if it worked for you, it should be fine. If you are interested I'll try to describe this for you. Cut your applique and your interfacing (with 1/4" seam allowance) the same size. Lay them right sides together, the fusible side being the right side, sew around them, leaving a gap that's big enough to turn them right sides out, clip any curves, etc.. to make them lie flat. Close up the gap you turned everything through (I do it by hand, but it probably would be ok to do by machine, since the buttonhole stitch will cover everything). With the fusible now on the back, iron the whole thing in place on the background. Do your blanket stitch. Does that make any sense at all?