A good Greenland style paddle can be made for a lot less $$$ than a high tech euro paddle. Clear cedar will make an excellent paddle and 2" x 4"'s can be a great piece to start from. Get yourself a block plane and just start shaving down to the thickness and shape you want. As for varnishing or not, I went with both. I varnished my blades and epoxied the tips to make them a little more resistant to getting dinged up on the rocks. I left the loom/shaft untreated to provide a little better grip. I don't worry about the wood rotting since cedar itself is pretty good at standing up to that. One last trick is to slightly feather the blades using the opposing diagonals of a 2" x 4". It's not historically accurate and may confuse you when trying to brace against a wave, but it does ease the strain on my wrists a bit. Keep in mind that your cadence with the greenland stick will be at a higher rate than with a euro spooned paddle. (Think of it as a third chain ring on a bike.)

Good luck.