Frame Blending causes the images to soften, but makes the static still images transition more slowly, creating the illusion that additional temporal information exists between frames.
All FCP does for slow mo is play frames out longer. So with it turned off, moving from frame to frame might be a bit jaring (probably varies from situation to situation). Blending can help ease that. However, like the quote says, you'll most definitely then soften the image. To what degree/whether its tolerable for you, I think is something you need to test out for yourself and decide.
I think to get a real nice looking speed change you need to go outside of FCP and look to a third party option. From a thread just a few slots down, look into Twixtor or Retimer. Good luck.
