I love your fabric. I have some of that but in a different color (blue). If i were using that particular fabric for a OBW, I would cut them small. At most 3 inches. I happen to be working on a OBW right now (from panels) and cut them using 3 inch strips but wish i would have cut them smaller, like 2.5 inches. I think mine will be fine in the long run.... Just wishing I'd cut them smaller. I think it would have blended better. Since i have worked with your particular fabric in a quilt, i think it will work best with smaller strips.
as for the blunt end or not... Go with a pointed end. It is easier to match up to sew.