Thats the most effective way for reciprocal link building, agreed it takes time , is laborious and at times can be frustrating, but if you have a good site, few really targetted and related reciprocal links will help your site.
I sometimes do that as well. Reciprocal linking is only a small part of my link building, but I still will contact a webmaster with a personal email if I come across a site I like. However, I am pretty picky on who I exchange links with and will not exchange links if I am buried in a huge directory. I also would never use a link exchange website since I don't think you will find many quality links there. The links page must also be indexed in google and be related to my site. Google seems to like my links page since it increased it to a pr4 last update. The traffic I receive my exchanges is nice as well.
You can find many Webmasters to trade links but I can suggest a great way to house your links. Get yourself a good re-seller hosting package for about 25-23 dollars a month from a good hosting company, thats how I got started, and take a few months to assemble great linking sites of all kinds which you can get for free in alot of cases, and start your own little link army and with you having multiple sites, webmasters will want to make you deals for recipricating to get on all of your sites, plus, in the process your own sites will build your ranks!!
i also had the same experience with backlinks.com where i receive lots of link request everyday not even closely related to my sites. its all waste of time.
For me, the big factor is always the design. In my opinion, if the design is bad, no serious webmaster will want to link to that site. It is much easier to attract good links when you have a nice design. The problem is, most link exchange sites are low quality design, and attract low quality links. I suggest spending time on your site making it look nice, then approach the PR5 websites for links. Get rid of ALL advertising off your site unless it is paying you well. If your site covered with adsense is only paying you $20 per month, you are better off getting rid of the ads and going for decent links instead. Most of my sites are PR5 now, and I still check out most of the link requests that come in. But if the sites don't look like they were made for people, I won't consider linking to them.
Thanks for the advise. I know I need to do something different with my site. I think it's easy to use, but I'm just not satisfied. As far as the link exchange goes, there are not many companies that do the same thing that I do so finding related sites has proven to be a challenge in itself.