Actually, blocking is more than laying flat to dry. It is shaping the knitted item to the final, finished measurements which, with a blanket, isn't difficult since it's a square/rectangle. There are different ways to block - wet, steam, etc. but do whatever your pattern recommends. The rub here is if you want something machine washable and durable, I would recommend an acrylic or acrylic blend (which cannot be blocked). Maybe a super-wash (machine-washable) wool, but I haven't had great luck with actual machine-washing with those - they typically stretch out, even on the gentle cycle. If you want to give an heirloom gift, use a natural fiber such as cotton or bamboo or soy (go vegan knitters!). Wool will likely be too itchy for a baby. If you use a natural fiber you should recommend that it only be spot-cleaned, hand-washed, or dry-cleaned (which is gross since the baby would be laying around in all those chemicals - ick). Hand-knitting for children is a joy but you have to face the fact that kids are messy, destructive, and forgetful. Go to your LYS (Local Yarn Store - not Michael's or JoAnn's) and talk to the experts. They are snobby sometimes but they usually know their fibers and can help you choose something that will fit your needs. Keep knitting!