Hi fellow webmasters,
I have to say that my past (and partly present) as a personal blogger taught me that link exchange can be a good way to build relationships when it's done socially-- i.e. to build circles of friends through your website, not to manipulate search engines.
Many personal bloggers still don't care about search engines, so they won't care about adding a nofollow tag to friends' links, but SEO-aware webmasters can still build circles of friends -- and relationships -- using a nofollow tag on links.
Have you tried to do social link exchanges in the past? Did they help you build a community around your website?
They always did for me. :)