Paraquel seems to already have a level of acceptance. I found a few different links that talk about it. A Google search will reveal even more.
Funny how a word seems to be everywhere when one knows what to look for. My first thought was to use the prefix ~syn, as in synthesis to form synquel. I Then looked online and discovered some troll has trademarked the term. Which is lame. So I abandoned that idea and then considered one of the words suggested in a different answer, paralleloquel.
While in my opinion it seemed to have more potential than other suggestions, the problem is that the word parallel means two things alongside that don't ever touch, which isn't appropriate for two stories that intertwine. However, if we strip down to just the prefix ~para, we find that it means "alongside, beyond, altered, contrary", which is suitable enough. Especially the "alongside" and "altered" bits.
~para is Greek, and ~quel is Latin, but I don't think anyone is too bothered about that kind of thing anymore.
So, my vote now is definitely for paraquel.
I've just read Ender's Shadow. It's a paraquel of Ender's Game.
Just for fun, also note in those links above some other interesting words such as circumquel, interquel, and inquel. One I don't see suggested, but could be, is intraquel, which would be a story within a story.