There are a number of ways you could have done it, and yes, this is one. Looks good.
I am SO glad you asked this. Lots of people never even think of it. The number of time I see an out-of-focus sky replaced with an in-focus one, it makes me sick.
I can't tell from this distance whether you need to blur it or not. But if you think you do, don't ignore than instinct.
Always get bigger than you need.