I'm looking to make the opacity box behind the title blend in with the image instead of overlapping it such as in this picture:

What version of Atahualpa and WP?
What is the sites URL?

3.4.9

http://www.freeggwowguides.com/

You aren't going to be able to "blend" those two items. One is a background image and one is the title overlay. To get the look you are after just create a single image and use it as a header image or a logo.

I see, thank you.