While in game... click <TAB>. This will bring up the player list. Then click (might be right click) on the player's name that you wish to add to your buddy list. <Add to buddy list> button should now show. For a player to accept your invitation, they must go into their buddy list and they'll see the pending invite.
Personally, I just use XFIRE. I know many who say they've accepted and sent invitations that never registered.. or took. They repeatedly had to keep inviting. I think they incorporated the system with the realization, that players look for each other online. I don't think it works as well as they had planned.