Two choices;
One do what an upholstery guy would do, get a sheet of muslin (go to a fabric store), cut to fit with some "tails", then hog ring the muslin over the foam to the seat frame (unless it's plywood then use staples). Then cover with the blanket, use same type fasteners to keep it in place.

Or look at what these guys do: http://www.rodinteriors.com/