Without seeing the pic it's hard to suggest the best way, but if you have CS3 the quick selection tool is pretty good, otherwise theres the magic wand, or quick mask where you just "paint on" the masked area. Photoshop has lots of different ways of selecting an area these are just a few of the easy ones.
For the blur, the easiest one is gausine blur, lens blur is better but a little harder to apply and get right if your not experienced with photoshop. Wayne