How is this done exactly? I notice people selling credits in the book bazaar and requesting credits elsewhere, so I looked around the credit transaction options and such but can't determine how one would gift, buy or sell credits to other members? 

Danielle, members will buddy the credits to each other.  There is a 50 credit limit per month that you can send to other members. 

Rewording:  You would go to the bookshelf the the person you want to gift the credits and click on the button "Give Credits"  there is a drop down menu and you can select how many credits you would like to gift that member. 

If you click on the Help Center, then help docs, search for

How do I give credits to other members?

 adding this URL, but if you click on it it will only bring you to the search field.  http://www.paperbackswap.com/help/search.php?terms=gifting+credits

This will give you step by step instructions.