There is. Use a black/white gradient; put it in a track above your blurred image; make a parent/child composite relationship; set the composite mode to multiply (mask); drop a mask generator on the gradient. This should give you a nice gradient of the blurred image.
Then, put a clean copy of the clip/image in an independent track under the composites.
And, with Vegas, there are probably several ways of doing it.
Thanks David, but I think I'm still doing something wrong. When I do what you suggest, My image brightness goes from light to dark. How do I "drop a mask generator" on the gradient. Can't figure out how to do that. Maybe taht's my problem.