I - Rules
(see JITD, p. 22; FAQ)
Attacks with the Blast ability affect every space within X spaces of the target space, where X is equal to the rank of the Blast ability. A space is only affected by the Blast attack if it has line of sight to the target space (ignoring figures for this purpose). Blast areas cannot pass through walls, closed doors, or blocking obstacles. The Blast attack deals its full damage to each figure affected by it (friendly and enemy). If a Blast attack is dodged by more than one figure, only one re-roll may be made (the first dodging player to the attacking player's left decides which dice, if any, are to be re-rolled).
The FAQ also states about Blast and Breath that these abilities are not mandatory. If not used, the attack is treated as a normal ranged or magical attack.
II - Reference
Heroes with the Blast ability: none.
Monsters with the Blast ability: Lava Beetles.
Items granting the Blast ability: Bane, Flamestrike, Ice Storm, Sunburst.