
Blake, seeded second, was competing for the first time since losing in the Wimbledon third round to Juan Carlos Ferrero last month.
The American who broke through last season with six titles, has gone off the boil, winning his only 2007 trophy the second week of January at Sydney.
Blake will have to quickly lift his level as the hardcourt season starts, with championships points from Indianapolis to defend this week.
Blake won his second match in Los Angeles, where he lost in the 2001 first round.
Peya, ranked 109, remains winless against Top ten players, standing 0-8 against the elite.
David Nalbandian's downward spiral continued with the fourth-seeded Argentine crashing out, a 7-6 (7-5), 7-5 victim of Russian Igor Kunitsyn.
"This is the best tennis I've ever played," said the 25-year-old winner from far-eastern Vladivostok. "It's one of my best victories."
Nalbandian has fallen out of the world's top 10 and top 20 this season, and his hiring of compatriot Martin Jaite as a coach has made little impact so far on his sinking form.
Nalbandian's last match on cement was a third-round defeat in March in Miami against Jarkko Nieminen. His best result of a modest season was a Barcelona quarter-final nearly three months ago.
The 99th-ranked Kunitsyn has been on the opposite trajectory, breaking the top 100 for the first time in 2006. His victory in just under two hours earned him a meeting with 2004 finalist Nicolas Kiefer of Germany.
American Mardy Fish stopped the rot of an eight-game losing streak as he defeated teenaged doubles partner Sam Querrey 7-5, 6-4.
The welcome victory left Querrey, billed as the next US hope, nursing his sixth straight defeat as the American game struggles to keep pace on the ATP.
Fish, a wild-card entry who missed the French Open after injuring his ankle in May by kicking a gridiron football barefoot, fired 10 aces in his winning effort, which took less than an hour.
"I'm definitely excited to win again," said Fish. "I wasn't planning on playing here but I wasn't planning on losing eight in a row either."
Czech Radek Stepanek benefited as Brit Alex Bogdanovic had to retire trailing 6-1 with a back injury from last week.//dpa