To cut a tall story short: Blackburne dissed Steinitz, who, in turn, gobbed in his face, whereupon Blackburne settled matters by throwing him out of a first-floor window.

Actually, Winter's feature article <Chess with Violence> does not support the apocryphal story you summarized, but refutes it.

Winter quotes Steinitz ('International Chess Magazine', November 1889, pp. 332-333):

<And on one occasion at Purssell’s about 1867, in a dispute between us, he struck with his full fist into my eye, which he blackened and might have knocked out. And though he is a powerful man of very nearly twice my size, who might have killed me with a few such strokes, I am proud to say that I had the courage of attempting to spit into his face, and only wish I had succeeded, Dreckseele. And on the second occasion, in Paris, we occupied adjoining rooms at the same hotel, and I was already in bed undressed when he came home drunk and began to quarrel, and after a few words he pounced upon me and hammered at my face and eyes with fullest force about a dozen blows, until the bedcloth and my nightshirt were covered with blood. But at last I had the good fortune to release myself from his drunken grip, and I broke the window pane with his head, which sobered him down a little.> (Dreckseele is Hoffer, who gave a wrong account of the incident(s))

So 2 separate incidents, Steinitz didn't spit into Blackburne's face (only attempted to), and Blackburne came into contact with a window - the 2nd incident was most likely Paris 1878, where Steinitz was also present (although not as a participant).