i see it advertised all the time in osmo videos but never demonstrated. how can i achieve background blur and what settings? and can i do it with noth video and pictures or just one?

background blur is made possible by a shallow depth of field. This requires a large aperture coupled with a longer focal length.  The Osmo is  a wide angle lens with a fixed aperture and cannot achieve this.  A slight blurring of background  will occur only if the subject is very close to the camera, but it will be very modest.

As a professional videographer I have paid thousands of dollars for lenses capable of this, so I'm afraid that the OSMO is not able and is designed as a catch all solution and for this it does a reasonable job.
sorry to disappoint.
Rod and the cat

You'd be able to get that with the X5 camera & different lenses on the OSMO however it is not officially supported yet. However you then have to make sure every shot is in focus, you might even need a focus puller (a person whos job is just to smoothly ajust the focus) & so quite simply its probably not suited for a novice. However do try it out, play & see what happens.

Why is pocket3 not available in india