fade out from the centre 

http://www.linuxquestions.org/questions/history/208491

> how do I fade / use as a watermark with gimp (simple case)?

If by "fade out from the centre" you mean that the middle of the image is opaque and gets gradually more transparent as you move to the outer edges of the imageā€¦

Switch to the channels panel. Create a new channel, and with that channel selected create a radial gradient from black in the center (where you want it to be opaque) to white on the outside (where you want it transparent). Right-click on the channel and select "channel to selection". Then go back to the layers panel and reselect your layer (deselecting the channel). Cut. This should delete the outer parts of the layer, but in a gradient, so it gradually disappears as you move outward.