I used the selection tool to create the outline for the white peaks section. Then I created a new layer over yours (pasted into a new document from copying your image) and filled it white a solid white. Then dropped the opacity to 55%.
You will be able to get a better result since you have the original files. Also, it would have been a lot of work for me to do it behind the text but I'm assuming your text is on a different layer so it should be cake.
Edit: For the graininess, if you're saving it via Photoshop I would just check the quality (1-12) to make sure its pretty high. If you're saving via mspaint it'll always be grainy.