You should be using a Gaussian filter. Here is how I did mine in GIMP:
First image (long range viewable):
I used 10x10, but if you want the change over point to be further away you should use a bigger number.
Second image (close range):
I used 10x10 again, but it doesn’t necessarily have to be the same.
Copy the image and paste it as a new layer. Then on either layer:
Set the top transparency to 50%.
I flattened this image and then copy/pasted it into the first image. Set the transparency of the top layer to 50% again and you have your image.