Welcome, SkyGuy!
Layers happen to be one of my favorite subjects

You can do so much with them! And it sounds like you're off to a terrific start
To answer your question about "using black and white" to blend, that's most easily done by a layer mask. You can apply a gradient, use a brush, even use some filters on the mask...just make sure the mask thumbnail is active. When you click the mask icon (see image below) your colors should change to black & white automatically, unless you had a shade of grey for one of your colors. (Tip: to get the default b&w, type the letter "d")
The image below is certainly nothing fancy, but just something to show you a very small part of what you can do with layers. (It's a low-quality jpg to boot, but I wanted to keep file size down.) It started life as two layers, one black, one light grey. The circle on the right is the result of playing with blending modes, opacities, color fills, layer effects, and a layer mask.