The isothermal cold crystallization of poly(ethylene terephthalate)(PET) in cryogenic mechanical alloyed blends of PET and Poly(ethylene naphthalene 2,6-dicarboxilate)(PEN) 1:1 by weight has been investigated by simultaneous small and wide angle X-ray scattering (SAXS and WAXS) and dielectric spectroscopy (DS). For transesterification levels higher than 23% the blends tend to transform into a one-phase system and the crystallization of PET is strongly inhibited due to the significant reduction of the PET segment length. For lower levels of transesterification the blends are phase separated and the overall crystallization behaviour can be explained considering the confined nature of the PET domains in these blends. The formation of a rigid amorphous phase in the intra-lamellar stack amorphous regions is reduced in the blends due to a lower probability of stack formation in the confined PET-rich domains. The more effective filling of the space by the lamellar crystals in the blends provokes a stronger restriction to the amorphous phase mobility of PET in the blends than in pure PET.