Here's a possible solution.
HTML
<img id="source" src="http://www.byui.edu/images/agriculture-life-sciences/flower.jpg" />
<div id="crop">
<img id="overlay" src="http://www.byui.edu/images/agriculture-life-sciences/flower.jpg" />
</div>
CSS
#crop {
overflow: hidden;
position: absolute;
left: 100px;
top: 100px;
width: 450px;
height: 150px;
}
#overlay {
-webkit-filter:blur(4px);
filter:blur(4px);
width: 450px;
}
#source {
height: 300px;
width: auto;
position: absolute;
left: 100px;
top: 100px;
}
I know the CSS can be simplified and you probably should get rid of the ids. The idea here is to use a div as a cropping container and then apply blur on duplicate of the image. Fiddle
To make this work in Firefox, you would have to use SVG hack.