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This is very simple and flexible way to manage pages in the nav bar.
You will see this in the IN THE URL bar: yourdomin.com/wp-admin/nav-menus.php
This WordPress theme is set up for WordPress 3.0 Menus
As seen here on the screenshot under the Appearance >> menu page on the sidebar in the WordPress admin.
First you need to name the menu areas starting with the Menu name as you can see towards the right hand side under the tab, and make sure you click save on the right-side.
Then you need to assign the menu name to a location (theme location bar), that you can see that the arrows are pointing to
*The Footer-Menu is new.
*also use caps in the Menu Names, formatted the same way you see in the screen shot.
Then you can drag and drop the pages in the Menu area that you would like to use.
I also added this video that will help explain this better.