I'm not a pin trader myself, but the concept is pretty simple.
If you have a pin collection, you wear some of it on your person while touring WDW (on a lanyard, hat, vest, whatever). Others who have pins will look at yours, and if they like one they wil offer to trade one of thiers. You are free to accept, decline, or haggle, whichever you want. If you see somebody else with a pin you'd like to have, make them an offer. Remember, nobody is under any obligation to trade; you make an offer, and they are free to decline; somebody makes you an offer, and you are free to decline.
Almost every CM has a lanyard or two full of pins, and it seems like at least a third of all Guests sport pin lanyards these days, too. Pin trading is very popular.
There are also Pin Stations all over the place, in the parks, resorts, and Downtown Disney, which are basically large vendors selling pins, lanyards, and other collecting paraphenalia. The pin stations tend to be hotbeds of collecting, as Pinheads (as I call hardcore pin collectors) gather to look over the vendors wares and always look at each others pins, too.