Painter Essentials 3's Smart Blur filter uses edge masking to perform its magic. There really is no current equivalent in Painter. Filters like Smart Blur remove complexity from an image. This is particularly useful when applied to a photograph. The effect is akin to the visual look of traditional media like watercolor. This is not to say that Smart Blur makes a photo look like watercolor, but it does move the image away from possessing the hallmarks of photography: sharp-focused complexity.
While Painter does not have a Smart Blur filter, a similar effect can be achieved with the Effects: Focus: Glass Distortion effect. By selecting Image Luminance from the Using pop-up list, you can choke and spread the light and dark areas of an image. Choke refers to shrinking areas of density within an image; Spread refers to expanding areas. You can use the Invert checkbox to reverse the effect of Choke/Spread.
The application of Glass Distortion to a photograph is not the same as Smart Blur, but it does tend to drain an image of its complexity. You can experiment with the Amount slider to either exaggerate or reduce the Choke/Spread effect.
Viva la Painter!