Lens wont retract, view lens blurry

There are some cameras who give problem when they are new. Give it some time i am sure it when the battery is on the move it automatically repaired.

The problem is in the lens housing, there is a circuit called ccd which is a sensor controlled by the systems control board. The sensor is malfunctioning or the motor and gears are jammed making it impossible for the lens to focus, the only option is a camera technician and probably cost as much as a new camera.

I wish I could offer some simple solution, but the lens has somehow gotten damaged and is no longer able to focus or withdraw into the camera body. It could be as simple as some sand in the lens, but even that will require a trip to a camera repairman 

If your images are blurry and the lens wont move smoothly it is very probable that some kind of force on the lens has damaged a gear, barrel or even dislodged an element internally. When the lens detects an obstruction in its movement the camera reports accordingly,"lens error". You should have the camera checked by a service centre, it will most likely need the lens replaced as they are not serviceable.

The problem you are describing is a problem with something in the lens assembly of the camera. It seems to have failed and needs to be replaced. Following are the instructions to send your camera to Olympus for service.

http://olympusamerica.com/cpg_section/cpg_servicerepair.asp

Olympus will charge a flat rate repair fee for this product if beyond the one year factory warranty or the warranty is voided. The cost is $73.85 plus your local sales tax. This covers parts and labor, factory cleaning and diagnostic check, 6 month warranty and the cost of shipping the product back to you is all included in that price.

after 4 seconds view screen pic melts and goes blurry

Belikes, any external object is trapped in between your Lens Motor and Camera Body. You should consult Authorized Service Personnel to handle this trouble.

Never buy a Canon camera again. I have the same problem, and sorry that nobody has a solution. This is the worst of the 3 Canon digitals I have purchased. Lack of a view finder makes it impossible to preview shot when outside on a bright day.

Try some of the less severe repair techniques for a lens error:

http://camerarepair.blogspot.com/2007/12/fixing-lens-error-on-digital-camera.html

Lens is most likely been knocked out of place, that would be the reason why you have out of focus and/or blurry photos. This would also be the reason why you can't retract or extend the lens.

Gently pushing on the lens MIGHT fix the camera, but I would only try as a last resort. Sometimes all that is wrong is the gears get out of place, and by gently pressing on the lens, it snaps the gears back in line, which will bring the lens into working order again.