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Don't pack blankets. You'll want them to cushion your furniture in the moving van.
Regarding labeling boxes, try to pack according to the rooms the stuff will be in, not where it is now. If you are downsizing, you may end up combining rooms (like office and living room are now together).
You'd be surprised at how many people collect boxes and bubble wrap. Ask around, and you may be able to get a lot of that stuff for free.
I'm really sorry for your loss. Definitely don't get rid of anything. I was just having a conversation with my mom about cleaning out her grandmother's house. Her father rushed them through it, and over 30 years later, she's still mad about it. Best to get rid of things on your own terms.
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