One of the articles I gave you to read talked about crating a dog/puppy while you are not at home or at night. Crates can be a wonderful training tool if used correctly. Maybe you could give some thought to that. Puppy ripped up the blanket because puppy was bored. If she is in a crate she can't get to anything to rip it up. It's not her fault. It would be a great idea to do some reading and further research into crating a puppy successfully and then doing so. Nothing the puppy is doing is anything any dog would not do when it's bored out of it's skull.
There's lots more articles available about crating as well. I'm sure someone with more time will be along soon to explain the fine details of crating.