Is there a way to blend cut scenes with gameplay?

So this documentation link will help with blending the animations into and out of the cutscene.

If you’re also looking to get the camera to seamlessly blend from gameplay to cutscene (and vice-versa) use an Event track on the sequencer’s camera and add a key at the very beginning of the sequence. Double-click the key to open the Sequence Director, it will also automatically create the sequence event you’ll need. Get the player controller within the sequence event and use the reference to the camera (labeled ‘Target’) to ‘Set View Target With Blend’, setting ‘Blend Time’ to whatever is appropriate for the scene transition. You’ll do something similar at the end of the cutscene, but the Event key will be just before the very end of the sequence (if the blend will take 1 second, the event should be at least 1 second before the end of the cutscene) and you’ll need to pull up a reference to the player’s pawn from the Player Controller to set the new view target. You’ll also want to move the start and end of the ‘Camera Cuts’ track away from the very start and end of the sequence to stop Unreal from snapping the camera. Of course, if you plan to only blend out of the cutscene (like Mortal Kombat) you won’t need to bother with moving the start of the ‘Camera Cuts’ track.

Just make sure that the Event track you use for the camera blend is a Camera Event track, not a general Sequencer Event track, otherwise you won’t get the reference to the sequencer’s camera.

I hope this helps.