It's just
Grace +
Lyn. Adding
Lyn on to the end of other names is a trend that was popular for the whole of the 20th century and is still gaining in popularity. Gracelyn is a relatively recent addition though:
http://www.behindthename.com/top/search.php?terms=Gracelyn&popterm=&gender=both
Anything else you wanted to know about it?
♦ Chrisell ♦
All we have to decide is what to do with the time that is given us. - J.R.R. Tolkien.