It is derived from the word 'ghetto' attached to the words 'black' and 'child' which have been changed in order to give it a smoother sound. 'Ghetto blay chay's tend to be african american in race, hence the name. This is used as a compliment rather than a derogatory remark.
The creator of this phrase, although unclear, is heard to be named as a Mr.Kano, a rap producer settled in the U.S.A.
Man 2: "Ya dam strate son! and i waxed that asssss, till she showed me what shes wurkin with!!"
Man 1: "Dam dawg! You's a strate up ghetto blay chay!"
Man 2: "Wurd!"