As far as I know BLOBs (and TEXTs) are actually stored outside of the table, VARCHARs are stored in the table.
VARCHARs are bad for read performance because each record can be of variable length and that makes it more costly to find fields in a record.
BLOBs are slow because the value has to be fetched separately and it will very likely require another read from disk or cache.
To my knowledge InnoDB doesn't do anything differently in this respect so I would assume the performance characteristics hold.
I don't think moving BLOB values really helps - other than reducing overall table size which has a positive influence on performance regardless.
VARCHARs are a different story. You will definitely benefit here. If all your columns are of defined length (and I guess that means you can't use BLOBs either?) the field lookup will be faster.
If you're just 'reading' the VARHCAR and BLOB fields I'd say this is worth a shot. But if your select query needs to compare a value from a VARCHAR or a BLOB you're pretty sour.
So yes you can definitely gain performance here but make sure you test that you're actually gaining performance and that the increase is worth the aggressive denormalization.
PS.
Another way of 'optimizing' VARCHAR read performance is to simply replace them by CHAR fields (of fixed length). This could benefit read performance, so long as the increase in disk space is acceptable.