Unless things have changed I’m not aware of any way of merging Time Machine backups. The last time I checked you could not even clone a TM drive.
I was not aware that Chronosync would not backup to an encrypted drive. I do use CS to backup to encrypted sparsebundles on an unencrypted drive.
And, instead of a bootable clone of my mac that gets updated periodically, I keep a clean install of Catalina, with my applications, on a Samsung T-5 SSD. If needed it takes a bit of extra time, to restore my user directory & data, but eliminates the need to keep it updated.