Samh, the "realistic blur effect" is more easy that you think (in Adobe After FX is called "Blending" and is more easy to use).
To do it, you must olny activate the blending switch in every layer that you want, in the layer's palette.
Then when you do the video render, After fx will insert a "mixed frame" between all the frames, and the result is an input with a 25 fps (the original capture) and a 25 fps output with blur
This option is more used by the 3d animation studios, because normally they don't record nothing with cameras because all is virtual.
You can see the result here. (maybe you're seen this video)
http://www.lfsforum.net/showthread.php?t=15206
Cheers
PD. sorry but with the Sony Vegas can't I help you because never I use it.