u know. u could actually create 2 executable.
1 is the "transparent" rectangle.
and 1 is the form itself.
using sendmessage u can communicate with each other.
so, the transparent form, will just do the blur-copying and nothing else.
and since its just a small area it should be fast.
subclassing it and it will follow the main-form smoothly.

u will create a dual-thread-program this way.
I already do that with my game, 1 external program for screenshot, music loading/playback and wordchecker.
and the game is running smoother and without freezing when loading a new mp3.