I am trying to generate a playlist from two users different playlists. I know you can get a public playlist from a Spotify users id, hopefully their most played,but i am not sure if you can combine it with another user's playlist?
Sure. First read both of the users Spotify playlists. You'll have to use the iTunes Search API to find the respective track on iTunes and it's product ID. You can then use the music API's added in 9.3+ to make a playlist and add the product ID's for the songs in the two playlists.