He had lived in Yangon previously but returned to New Zealand for 12 months last year. His first child, a daughter named Sasha, was born in Wellington in August.
Today, his mother Angela Blackwood said the family "have been advised not to comment at the moment".
"We're all very upset about it," she said.
Blackwood and his partner Noemi Almo returned to Yangon to live in October.
In an interview with a local tourism website, published on December 10 but since removed, Blackwood said it felt good to be back in Yangon.
"I came back with eyes wide open; I wasn't looking specifically to getting back into hospitality but it's what I know and when this opportunity came up to run VGastro bar, I was really excited," he told Myanmore.
He said his new role required him to work nights, but that meant he had more time to spend with his family.
"Sasha is gem. Nightshift is a bit difficult but to be honest it affects my time spent with Noemi more rather than Sasha. Sasha is home (and awake) in the mornings so I can spend time with her then, which makes for a great start to the day," he said.
"Life is still great and exciting, with an infant you can still do things, some may hibernate with children but I figure, why not get out and do things when you can?"
An apology about the incident on the bar's Facebook page was slammed by locals.
"VGastro management would like to express our sincere regret if we have offended the citizens of this wonderful city," the post read.
"Our intention was never to cause offence to anyone or toward any religious group. Our ignorance is embarrassing for us..."
Local man Chris Soe described the use of Buddha as "utterly unprofessional and culturally insensitive" and "such a despicable act".