Where is the "blackmail?" From your post, they are offering you something (severance) in exchange for something to them (a release). That is certainly not blackmail (speaking of misinterpretation). In addition, it is quite "legal" for you and your employer to reach an agreement over these issues. The legal system (with a few too many exceptions) does not look over your shoulder to dictate what adults can and cannot agree upon. You have the right to take the money and walk away. That said, whether it is a good deal for you, or whether the actual document you have is binding (not "legal" or "illegal") are different questions. You would have to either accept the money and move on, or have a lawyer review the document and the situation.
To answer your two questions:
(1) This is not blackmail - parties are free to make these types of agreements with each other to settle disputes. This is like "making a deal" or a compromise in any other part of your life. They are offering severance in exchange for you waiving some of your legal rights. You have a choice whether or not you would like to sign the agreement.
(2) Severance agreements with a release component generally are legal. However, whether the specific release they want you to sign is enforceable is a completely different question. That is not a determination that can be made without having an attorney review the document for you. The employer should give you an reasonable amount of time to review/consider the agreement. I would suggest you contact an attorney in that time to advise you on this matter.