The one thing to consider with chrisqq's solution - which technically works - is that when you delete the title from settings > general, as far as search engines are concerned your blog does not have a title, and that will adversely effect your search engine ranking. The search engines cannot pick up on a blog title that is part of an image. It also means that anyone subscribing to your blog feed will instead of seeing the title of the blog at the top of the feed will only see the URL of the blog.
The following is a trick you can do with a text widget to change a background but I've never tried it with MistyLook. On some themes it works well and on others not so well. Put a text widget at the top of your sidebar and paste the following into the body of the text widget. Use the first for changing color only by replacing ffffff with the hexadecimal color of your choice. Use the second for using a background image you uploaded to your media library and replacing http://IMAGE_NAME.jpg with the full URL of the uploaded image.
<div style="position:fixed;top:0;left:0;background:#ffffff url('http://IMAGE_NAME.jpg');width:100%;height:100%;z-index:-1000;"></div>