Well, moreso I think it’s to keep a sense of community between users, rather than having random unrelated journals floating about in the oblivion of space and time. If you make it necessary to have a code for access, then you’re assured that you know at least one person - the one who gave you the code.
I’ve used some other blog and journal type things out there and by far, I enjoy LJ the most because of that inter-connectedness between users.
I agree with the annoyingness of not being able to create an account on LJ whenever and however you want to. I think, though, it serves a purpose. Places that just let you register–like FreeOpenDiary–tend to get really crowded, which slows down the server. Incidentally, those also tend to be the places that delete you after a certain amount of inactivity, which is rather annoying when you lose internet access or are using the account to keep up with your friends. With LJ, you pretty much have an account for as long as you want.
As for finding friends. . .you might want to try checking out interests. When you make your profile, they make you list a bunch of your interests. They can sometimes lead you to good communities, or to communities that you’re already involved with in other ways. I found the sdmb group by clicking on the interest “straight dope message board,” for instance.
Have fun!