Social: questions about seeing only friends in activity feed and making friends

OK, I hope that I ask this question clearly, as it has a few parts.

In the social theme, I want only friends to see other friends activity feed and profiles. I can make the profiles to friend only, but in the activity feed, you can see the activity of all members. I only want friends to see friends activity.

I use activity plus and in the choices under that, the first one let's you see all of the members activity.
If I go in a comment out that code, when someone logs in and goes to the activity page, it defaults to the activity of all of the members.

Also, if the profiles are made private, how is it that you can 'Friend' someone?
I am trying to protect the members privacy, but also allow them to make friends easily.

Am I missing something?
We are doing a lot of testing right now and these are the questions that I'm getting.

If you would like to look at what I'm talking about, go to:

http://avazoo.net
user: guest
PW: 1234567

Thanks