Lolpigs - if you go down the sleeping bag route then stick to the clothing recommendations according to the TOG (temperature) ratings of the bags. The guidelines are excellent and take away a lot of the guess work and you avoid overheating your LO, like Miss B was referring to.

You shouldn't ever use blankets (or sheets for that matter) with sleeping bags as they then become a SIDS risk and it defeats the whole point of the bag. They replace blankets and sheets Dress your baby accordingly and you should be right. A room thermometer (GroBag have an excellent one that doubles as a night light) will help you decide which bag and what clothing.

DD's room is about 18-19 degrees at the moment overnight with the heater set to those temps. We put DD in a 2.5 TOG sleeveless bag (these are the heavier winter bags) with a pj set and a long sleeved bodysuit or a spencer underneath. The extra layer on her arms is perfect with the sleeveless bag. If her bags had sleeves, id just use a singlet underneath her pjs.

As I said, the clothing and TOG guides that come with all good sleeping bags are very handy. I also have an online version of the GroBag 'what to wear' guide in my favorites on my phone. Google it if you want an idea of what I'm talking about