B737-300 flight crew experiences a cabin altitude warning horn at FL350 and notes cabin altitude at 9;500 FT and slowly climbing. A descent is initiated; QRH procedures are applied; and cabin altitude reaches 14;000 FT before stabilizing using manual control. Flight continues to destination at FL210 with the cabin pressurized manually.

Narrative

Cruising through high altitude clouds with engine anti-ice ON and ignition ON we were picking up trace ice in a smooth ride. There were also numerous thunderstorms along the route; but we were easily able to navigate around them. At approximately 40 minutes into flight we received the cabin altitude warning horn (the reading on cabin differential pressure gauge was about 9;500 FT). We noticed cabin pressure rising and simultaneously donned oxygen masks. We then ran the 'cabin altitude and rapid depressurization checklist.' After this we moved to the QRH; requested lower and started our descent. We were initially cleared to FL290 with 'expect lower' from ATC. At this time the cabin was climbing at 100-200 FT per minute; with some spikes up to 400 FT per minute; as well as some points where pressure seemed to stabilize. We also noticed duct pressure PSI fluctuations for both packs ranging from 20-40 PSI (both packs were operating on full cold for the entire flight due to passenger requests of being too warm.) Once cleared below FL290 we continued descent and noticed cabin press. Continuing to climb at a steady rate of 100-400 FPM at which time we requested 10;000 FT and ATC approved it. At approximately FL240 in the descent we noticed cabin press. Approaching 14;000 FT; at this time the Captain made an announcement to passengers; alerting them of pressurization problems and that the oxygen masks may come down. We were unsure if masks had deployed because cabin alt. began to stabilize at 14;000 FT and did not seem to go much higher. By this time we had descended to FL220 and noticed that cabin altitude was pressurizing as normal. We then requested a level off at FL210 for two reasons; there was a lot of weather below and this altitude was VMC; more importantly cabin altitude had stabilized at approximately 3;500 FT where it remained for the rest of the flight. At this point we contacted Dispatch and Maintenance to discuss the situation. We explained how the cabin pressure had recovered in manual mode. We then determined to proceed to destination without further incident.