So after some further investigation, I am not sure my code is working 100% correctly. Take a look at this image, the square on the left is drawn without my AA shader, the square on the right is drawn with the shader. In both cases you can see alias artifacts, just on the right it is blended.
That does not seem correct?
Ignoring that issue, here is another example image (it is a jpg but you can see what I was talking about above), on the left I have two squares drawn in blue, on the right are the same two squares but one is drawn in white. Where the two overlap you can see how the line is very hard to pick out from the background.
So yes, Jackis was correct, when I mix blue (0,0,1) with white (1,1,1) you get something close to grey (.5,.5,1) (Lines crossing one another at various angles are not a problem).
Drawing with different blending functions is an interesting thought, I might play with that a little.