Page1 of source PDF file will be insterted after page 1 of destination PDF file, page 2 of source file after page 2 of destination file etc keep inserting until last page n of source file is insterted after page n of dest file? (both source and destination pdf files have same number of pages)
So you mean interleave the two files? Yes, it's possible, but it's tricky. For starters, after you insert the first page after page 1, page 2 of the target file is no longer page 2, but page 3... So you'll have to either keep track of that when deciding where to insert each page, or do it in reverse (starting from the last page and moving backwards to the first).
I've actually created a (paid-for) tool that allows you to do it very easily and quickly. You can find it here: http://try67.blogspot.com/2008/12/acrobat-combine-even-odd-pages.html
Let me know if you find any best solution.