If blending images of multiple map services (no matter if cached or dynamic) the different images get merged to one image on client side. The setting which image format is used for the result image, can be set on application level.
Open the configuration of your web application and navigate to WebOffice, Image Blending.

Image Blending setting in application configuration
The advantages (e.g. transparency - PNG32) and disadvantages (e.g. big image size - PNG32) of the different image formats can be reviewed in the previous chapter.
Note that merging layers with low quality (e.g. aerial image JPG cache) will always lead to low quality merged images whatever image format is defined. The visible layer with the lowest quality will be responsible for the quality of the merged output image!