Irregular blur around the edge of a frame is typical of old budget lenses, where optical quality was somewhat limited. Photoshop has an array of blur filters that can mimic this look.
Before applying blur, depending on what you’ve done already, you may need to combine several layers into one. If so, highlight the top layer and use the shortcut Cmd/Ctrl+Shift+Alt+E to merge a copy. Right-click the layer and choose Convert to Smart Object.
Next, go to Filter>Blur>Gaussian Blur and set a Radius of about 10px (although the strength will vary depending on the resolution of your image). Once applied, make a circular selection with the Elliptical Marquee tool then right-click, choose Feather and set a high radius of 50-100px.
Finally, Alt-click the Add Layer Mask icon to hide the blur in the selected area so that the corners are soft and the centre is sharp.
New Photoshop CS6 Blur filters
If you have Photoshop CS6 you’ll find three excellent new blur filters that all replicate types of photographic blur. They’re ideal for retro photography camera effects.
Iris blur allows you to create a circular sharp area surrounded by blur, so it’s probably the pick of the three for this type of project. You can also get excellent results with the Tilt-Shift filter.