The ‘Cursor appearance’ option lets you configure the cursor to be a block, an underline, or a vertical line. A block cursor becomes an empty box when the window loses focus; an underline or a vertical line becomes dotted.
The ‘Cursor blinks’ option makes the cursor blink on and off. This works in any of the cursor modes. (On Windows, the blink rate matches that configured in Control Panel; so this setting will have no effect if cursor blinking has been disabled system-wide.)