@cat_ky thanks so much. What kind of spackling compound should I purchase? I also heard of joint compound- does either matter?

i always prime the paper first with an oil based primer or surface sealer (Guardz) to prevent the cardboard from wrinkling from the water in the joint compound, then spackle/joint compound then prime again, then paint.

Either will work, but, its a very small job, just buy a small container of spackling, for what you have.

The best way to do this is first sand the edges around where the blinds were because the paint at the edges is probably thicker than the paint on the wall, and there may be some caulk left on the wall. Next, with your eyes closed, run your hand over the wall and bare area. If your hand can detect a difference in height between the painted and non painted areas, that slight difference in height is going to show after you paint. What your hand feels, your eyes will see.

If you don't want to see a ghost of the blinds up there, the ideal thing would be to level it out with a skim coat of joint compound on the surface-sealed bare drywall, followed by sanding until it is smooth, which would raise the bare area up to the level of the paint. As Cleo mentioned, after sanding and before skim coating, apply the surface sealer. Then apply another coat of surface sealer over the skim coat before painting.

So it's sand, plug holes, sealer, skim coat, sealer, paint. I know this sounds like a lot of work, and it is. If you don't mind living with that shadow of the old blind, then it is far simpler. Or if you sand the edges and if it feels smooth between the paint and the drywall, you could skip the skim coat.

I like Dap DryDex spackling compound. Seems to shrink less and dry faster. Goes on pink; turns white when dry. Also, DryDex sands easily.

Filling the screw holes will be a multi-step process. Fill, dry, sand. Then fill again because the holes are deep and the spackle will shrink.

Thank you all so much! I lightly sanded and then filled with spackling compound (Dap - Dry Dex), then used Guardz to seal, and finally Kilz 2 water-based primer.

But within a few hours i saw tiny bubbles, and when I touched it, and it peeled off in layers.

Is it bc of the water-based primer?