Lorodar, that's it in a nutshell ^_^
Enchanting involves two things: breaking down uncommon (magical) items for ingrediants, and casting enchantments on weapons/armor.
The idea is, you take green or higher equipment (doesn't work with recipes or gems), and disenchant them. Enchanters have two skills, disenchanting and enchanting, like how miners can mine and smelt. They get things from these magical items like dust or essences.
These disenchanted ingrediants are what is used in enchantings' "recipes." Enchanters can then use these ingrediants to add stats to different armor or weapons, say, +5 damager to a two-handed weapon (which also gives a blue glow) or +3 Stamina to bracers.
However, enchanting is VERY expensive, because you need to use green items to get ingrediants. This means you either buy them, which is tough, make them youself (tailoring can make green items around level 100 or so... I know because I found a pattern for a green robe ;-)), or get them from friends/guild members (I send my enchanter friend every green I get... probably about 30g worth of greens so far).
Enchantments later on are very useful. A lot of people like glows, but the damage put on weapons are great. The problem is the cost... some of the ingrediants are very rare, and expensive. So, enchantments are expensive. Thus, you can make a lot of money, but it takes a lot to get up there. Plus, everyone is underselling their enchantments to raise their skill on the way up. The best practice is to have a guild member who enchants for your guild at a reduced rate, on the condition that you help them get greens. This is what I'm doing with my friend ^_^
Another thing to note: Because almost all equipment is soulbound once you equip it, make sure you're going to USE an enchanted piece of armor for a few levels. It would stink to enchant your weapon for 15 gold, and then find a better one a level later. Thus, I'm holding off on expensive enchantments until level 40 or so.
By the way, soulbound equipment can be enchanted by trading in the "Will not be traded." Yay ^_^