I used it (vaseline) to good effect during field exercises while I was in the US Marines, along with an inner liner sock and a thicker outer sock. So, I adapted that technique to the Camino. However, on the Way I used a product called Bodyglide instead of petroleum jelly. It's specially made to reduce friction, and comes in a small deoderant-type stick applicator. I brought two of them, but only needed one. It was a lot more portable than a big tub of goo, and it also had sunscreen capability (I never used it for that, though).
However, lubricant is not a bulletproof solution. My original boots were too heavy, and my boot insert arches were too hard, so I quickly ended up with a Euro-sized blister on each instep. When I changed my boots to a lighter Spanish pair (thanks to the folks at the Planeta Aqua store in Logrono), added a softer insert, and put maxipads over the insert (at the recommendation of the woman running the Roncal albergue in Cizur Menor), I was much better off. My blisters healed, and I only got one new one - a small bugger on the end of my third or fourth toe.