What most people do (and in no way do I condone this, nor have done so myself) but both pilots just log PIC. The only way you'd get busted is if the Feds looked at both your logbooks together. The biggest negative aspect though is during the airline interview you'll probably slip up, say there was another pilot on board
Most people do not do this. It's a foolish idea.
Dual logging of pilot in command is only acceptable under the regulation under very specific circumstances. Two pilots may log PIC when one is providing instruction as an authorized instructor (and no, pointing out clouds does not "count"), and the other pilot is acting as sole manipulator of the controls.
Two pilots may also log PIC when one is sole manipulator, and the other is acting as PIC of an aircraft requiring more than one crewmember. (Eg, the most common application, as safety pilot).
An ATP may log PIC while acting as PIC of an aircraft in an operation requiring an ATP. However, in this case, while another pilot may legally log PIC time while acting as sole manipulator, he or she should NOT.
The aircraft is rated for single pilot operations, however I have an MEI certificate, which says I'm legal to teach in this category and class. So in order for me to log PIC here, I have to log "Instruction Given" Am I stretching the rules here, and will the airlines question my PIC time in this 421???
If you're providing instruction as an authorized instructor, you may log it. Do not simply log time because you have the instructor certificate...only log in this manner if you're providing real flight instruction.
If you're flying with your friend and get to manipulate the contrls during the empty legs, then log the empty legs and forget logging the rest. Attempting to do so is cheesy and may eventually undermine your credibility. I've seen it happen in an interview.