In a tight Ligue 1 contest between third-placed PSG and the fourth-placed hosts at the Stade Geoffroy-Guichard, Saint-Etienne midfielder Jeremy Clement was judged to have handled the ball in the penalty area just before the hour mark.
Clement, who played five seasons for PSG before joining Saint-Etienne in 2011, came off the goalline to collect Thiago Silva's header from a corner and, although the ball appeared to strike the point of his shoulder, the referee awarded a spot kick.
Zlatan Ibrahimovic made no mistake with the penalty and PSG moved four points clear of Saint-Etienne, with Blanc's men sitting just behind second-placed Marseille due to goals scored.
While Saint-Etienne had nine shots with five on target compared to PSG's six, including three that tested the goalkeeper, Blanc was convinced the visitors deserved to triumph.
"We played very well which enabled us to pick up the three points," the 49-year-old coach said.
"We were the side that tried to play football, and we're very happy this evening with the result.
"We are still competing in four competitions and we'll see at the end if it is a good season for us.
"The scenario of the match was very good, Paris were always in control of the game."
The result means Ligue 1 leaders Lyon are four points ahead of PSG with the reigning champions having won their past two league encounters.
Despite remaining in contention in four competitions this season, including Ligue 1, PSG have come in for some criticism over their style of play and perceived lack of success.
That criticism has been a regular source of frustration for Blanc and midfielder Blaise Matuidi mimicked his boss after the win over Saint-Etienne.
"The most important thing was not to concede too many chances," Matuidi said.
"It's our second league win over Saint-Etienne this season and it shows that we are not having as bad a season as everyone says.
"The team is getting stronger and stronger."
