Supporting Info:
I use cocos2d to draw a sprite (graph background) on the screen (z:-1). I then use cocos2d to draw lines/points (z:0) on top of the background -- and make some calls to OpenGL blending functions before the drawing to SMOOTH out the lines.

Problem:
The problem is that: aside from producing smooth lines/points, calling these OpenGL blending functions seems to degrade the underlying sprite (graph background).

So there is a tradeoff: I can either have (Case 1) a nice background and choppy lines/points, or I can have (Case 2) nice smooth lines/points and a degraded background. But obviously I need both.

The Code:
I have included code of the draw() method of the CCLayer for both cases explained above. As you can see, the code producing the difference between Case 1 and Case 2 seems to be 1 or 2 lines involving OpenGL Blending.

Case 1 -- MainScene.h (CCLayer):

-(void)draw{

    int lastPointX = 0;
    int lastPointY = 0;

    GLfloat colorMAX = 255.0f;

    GLfloat valR;
    GLfloat valG;
    GLfloat valB;

    if([self.myGraphManager ready]){

        valR = (255.0f/colorMAX)*1.0f;
        valG = (255.0f/colorMAX)*1.0f;
        valB = (255.0f/colorMAX)*1.0f;

    NSEnumerator *enumerator = [[self.myGraphManager.currentCanvas graphPoints] objectEnumerator];
    GraphPoint* object;
    while ((object = [enumerator nextObject])) {

        if(object.filled){

           /*Commenting out the following two lines induces a problem of making it impossible to have smooth lines/points, but has merit in that it does not degrade the background sprite.*/

        //glEnable (GL_BLEND);
        //glBlendFunc (GL_SRC_ALPHA, GL_ONE_MINUS_SRC_ALPHA);
        glHint (GL_LINE_SMOOTH_HINT, GL_DONT_CARE);
        glEnable (GL_LINE_SMOOTH);
        glLineWidth(1.5f);
        glColor4f(valR, valG, valB, 1.0);

        ccDrawLine(ccp(lastPointX, lastPointY), ccp(object.position.x, object.position.y));

        lastPointX = object.position.x;
        lastPointY = object.position.y;

        glPointSize(3.0f);
        glEnable(GL_POINT_SMOOTH);
        glHint(GL_POINT_SMOOTH_HINT, GL_NICEST);

        ccDrawPoint(ccp(lastPointX, lastPointY));

      }
    }
  }
}

Case 2 -- MainScene.h (CCLayer):

-(void)draw{

    int lastPointX = 0;
    int lastPointY = 0;

    GLfloat colorMAX = 255.0f;

    GLfloat valR;
    GLfloat valG;
    GLfloat valB;

    if([self.myGraphManager ready]){

        valR = (255.0f/colorMAX)*1.0f;
        valG = (255.0f/colorMAX)*1.0f;
        valB = (255.0f/colorMAX)*1.0f;

    NSEnumerator *enumerator = [[self.myGraphManager.currentCanvas graphPoints] objectEnumerator];
    GraphPoint* object;
    while ((object = [enumerator nextObject])) {

        if(object.filled){

           /*Enabling the following two lines gives nice smooth lines/points, but has a problem in that it degrades the background sprite.*/

        glEnable (GL_BLEND);
        glBlendFunc (GL_SRC_ALPHA, GL_ONE_MINUS_SRC_ALPHA);
        glHint (GL_LINE_SMOOTH_HINT, GL_DONT_CARE);
        glEnable (GL_LINE_SMOOTH);
        glLineWidth(1.5f);
        glColor4f(valR, valG, valB, 1.0);

        ccDrawLine(ccp(lastPointX, lastPointY), ccp(object.position.x, object.position.y));

        lastPointX = object.position.x;
        lastPointY = object.position.y;

        glPointSize(3.0f);
        glEnable(GL_POINT_SMOOTH);
        glHint(GL_POINT_SMOOTH_HINT, GL_NICEST);

        ccDrawPoint(ccp(lastPointX, lastPointY));

      }
    }
  }
}