Final answer:
The Melungeons are the group that lived in the Blue Hills of Virginia and faced discrimination due to their mixed heritage.
Step-by-step explanation:
The group that lived in the Blue Hills of Virginia and were often seen as the worst combination of all racial traits are known as the Melungeons.
The historical context of this question is rooted in the complex racial dynamics that existed particularly in the Southern United States before the Civil War. During this period, free Black people largely resided in urban areas, and because of interracial unions, there were varying degrees of skin color which led to a social hierarchy among individuals of African ancestry. Terms such as mulatto (one Black and one White parent), quadroon (one Black grandparent), and octoroon (one Black great-grandparent) were used to denote this perceived social distance from whiteness or blackness.