Does the chdk allow me to change f stop?
If your camera actually has a variable aperature then CHDK will allow you to change it. A quick google of the sx260 shows it has a range of f3.5 - f8.0, which can be manually controlled with or without CHDK.
CHDK cannot extend this range - its a physical limit of the camera construction.
I'm new to cameras but I'm not satisfied with the f stop on this camera. I have it set to f/3.5 and I would like the backgrounds behind my subject to be much more blurry.
The little lenses used on P&S cameras might not match expensive lenses used on DSLR's but they do have really powerful depth of field. For the average snap shot photographer this is a good thing - getting good focus on their subject becomes easy. But as you have discovered, more professional effects become difficult. This is an issue with all P&S cameras - not just your sx260.
I'm new to chdk too. Is there a stable build for the sx260? And is there instructions on how to install?
Yes -
http://mighty-hoernsche.de/ The alpha/beta ranking of the builds is somewhat arbitrary. Best to follow the porting thread of a camera you are interested in :
http://chdk.setepontos.com/index.php?topic=7889.460As for instructions, start here :
http://chdk.wikia.com/wiki/Prepare_your_SD_card