Gaussian Blur In MATLAB and Connection to Image Resolution
When applying Gaussian Blur on an image you should care for the STD only.
The rest should be set as following:

STD_TO_RADIUS_FACTOR = 5;
kernelRadius = ceil(STD_TO_RADIUS_FACTOR * kernelStd);
kernelLength = (2 * kernelRadius ) + 1;
mGaussianKernel = fspecial('gaussian', [kernelLength, kernelLength], kernelRadius);


Now, regarding the resolution of the image, this is tricky since it has many parameters in it.
If you want to measure it in Cycles in Spatial (As DFT), you can see the spectrum properties (Cut Off Frequency) of a Gaussian Kernel.

Update

The STD_TO_RADIUS_FACTOR should be determined by the balance between accuracy and performance.
The above is basically a truncated version of the Gaussian Kernel (Which is infinite). The balance sets how good is the approximation vs. how long the Convolution Kernel is (The longer the higher computational resources it requires).