Dig around with your yarn needle until you find the tail, sometimes it’s impossible and I just have to cut a stitch at the very top to make a new “tail”
Then use your yarn needle to unweave the the very top
Then use your yarn needle or your fingers to unknot the circled knot
Then just frog it
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If you cut off the last round of the one you’ve already fastened off on, you should be able to unravel it
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For the granny square you could make a granny square chicken.
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Make a tote bag out of the granny squares!
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Maybe you can make a bag with the granny squares or still the blanket (it can also be a smoll blanket)
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