Blocking access to your site for foreign visitors won't change anything for your "real" bounce rate. The measured bounce rate will decrease in Analytics, but these visitors will still bounce when they get to your website.
If you're using a generic domain extension - you can indicate in Webmastertools that you are targeting the local UK market (if you use a .uk extension this is automatically the case).
I wouldn't worry too much about this bounce rate - as long as the bounce rate (and time/visit - time on page) for your UK visitors is ok
rgds
Dirk