I currently have two Time Machine external drives, but I want to move to using just one (I'd still have more than one backup, as I also use Backblaze). Is it possible to merge the two different backup folders from the individual drives into a single backup folder on one of the drives (or possibly to an entirely new drive)?
You mean you have two disks for TimeMachine backups? If yes: when they have started on the same date, they are fully the same, so you can just format one and use it for something else. If one started later than the other, I would take the newer one to reformat. assuming both are ending at the same time: now.