Oop, sorry. Distracted.

Don't confuse bologna and blarney. One's Italian, the other's Irish. One's tasty, the other isn't. The legendary Blarney stone was said to give you the gift of eloquence. Thus, the Gift of Blarney is the gift of eloquence - the ability to charm and persuade others. However, one who is engaging in blarney (as opposed to blessed with the Gift of Blarney) is engaging in excessive or suspicious eloquence: false flattery, "smoothe-talking", etc. (One engaged in blarney clearly does not have the Gift of Blarney, since you can recognize it as blarney.) This apparently derives from an 18th century literary character, Lady Blarny, who had a penchant for false flattery; she was named for the famous Irish stone in what was most likely a literary short-cut to help the reader more quickly recognize her proclivities.