How does the presentation of the old man demonstrate the blending of fantastical elements with the dismal nature of daily life? ("A Very Old Man with Enormous Wings")
The old man has wings. This fantastic fact alone should be enough to strongly consider that the man is an angel, or some sort of scientific miracle and/or hybrid. Pelayo and Elisenda hear the old man's "sailor's voice" and determine that this is enough to conclude that he is a castaway from a foreign ship. In other words, this angel is just some old sailor who happens to have wings.
The neighbor suggests that he is an angel but being so old, he is knocked down by the rain. Again, we have a fantastic element (a real angel), a spiritual miracle, but he is somehow no match for the dismal, daily rain.
Instead of inviting the old man (alleged angel) into their home, they leave him in the mud, outside with the chickens. People of the neighborhood treat the old man with no respect, "tossing him things to eat through the openings in the wire as if it weren't a supernatural creature but a circus animal."
When the crowd torments the man with a brandishing iron, he flaps his wings sending chicken dung and lunar dust into the air. Here we have "lunar dust" (celestial residue) and chicken excrement. The paradox could not be anymore polarizing. The dust of angels mixed with excrement shows a blending of the celestial and the waste of the earth.
Pelayo and Elisenda make a lot of money off of the old man, but treat him like an overgrown chicken. In the end, after he is no longer profitable, Elisenda watches the old man fly away, relieved that the daily annoyance is out of their lives.
This juxtaposition of the fantastic and the ordinary is a staple of Magical Realism. This shows how interpretation of truth is subjective. People will believe what they want as it suits their needs. People looking for a miracle will consider the old man to be an angel. People who treat him like a farm animal will see a farm animal.