Muslin holds up just fine if it's good quality - like any other type of fabric, good quality always lasts longer.
As for using blankets ... I have a (European) friend who prefers duvets to quilts, so she pieces quilt tops and stitches in the ditch to muslin to complete the duver TOP, and them chooses backing fabric for borders and backing to complete the dovet cover. She inserts blankets into the duvet covers.
She says she saves a lot of storage space that way - duvet covers lay and store much flatter than quilts, and the blankets don't have to match anything since they're hidden by the cover.