Is there any way to have a transparent object distort/magnify the stuff behind it?

Not for TGF2 Users but if you buy Multimedia Fusion 2 for 75£-Discount=40£, you can get the Lens Object, the Lens object has lots of uses including Distortion, Magnification, Cloak & Sphere.

Im pretty sure MMF2 isnt 75£ because its $119 USD

But thats unfair, why is it cheaper for the better country?

Last time I checked it was 10£=16€=20$.

Sience were on the topic of distortion, how can you make the screen blurr out (as it does in many SNES games) as a transition?

The closest you'll get is to use the actual transitions in GF2.

* Go to the storyboard editor.
* Right click on the level, you'd like to apply the transition to.
* Choose Properties
* In properties, choose your transition under Settings->Transitions.

There's a couple of the transitions, which's almost as the one you describe:
- Zoom 2 (zoom out)
- Mosiak (As known from e.g. Wolfenstein)
- Cell (As known from e.g. Indiana Jones - Last Crusade)

Hopefully, this will help you..

Hey, now. No country is better than another. Except Ireland.

Anyhoo, this "lens object" thing is really something I would like to see in TGF2.