It can be simple enough:
inpict = imread('peppers.png');
sz = size(inpict);
blocksize = [10 10];
outpict = imresize(inpict,round(sz(1:2)./blocksize));
outpict = imresize(outpict,sz(1:2),'nearest');
imshow(outpict)
What if you want to only pixellize a part of the image?
inpict = imread('peppers.png');
% extract sample region
sample = inpict(142:255,192:324,:);
sz = size(sample);
% blockify it
blocksize = [10 10];
sample = imresize(sample,round(sz(1:2)./blocksize));
sample = imresize(sample,sz(1:2),'nearest');
% insert it back into the image
outpict = inpict;
outpict(142:255,192:324,:) = sample;
imshow(outpict)
