Had a similar question and had difficulty finding an answer. The following function allows you to paste an image with a transparency parameter over another image at a specific offset.
import Image
def trans_paste(fg_img,bg_img,alpha=1.0,box=(0,0)):
fg_img_trans = Image.new("RGBA",fg_img.size)
fg_img_trans = Image.blend(fg_img_trans,fg_img,alpha)
bg_img.paste(fg_img_trans,box,fg_img_trans)
return bg_img
bg_img = Image.open("bg.png")
fg_img = Image.open("fg.png")
p = trans_paste(fg_img,bg_img,.7,(250,100))
p.show()