it's really simple, grab 2 monsters, some money, go to the shadow cathedral, talk to the old creepy looking guy and check what you will get after fusing 2 monsters...fusing monsters is great because the created monster might obtain some of the skills from its "parents" just like in persona.
I just fused a couple monsters to get exactly what I want. A Harpy and a Apsaras(SP?). I hope when I get into the high enough levels to get an Archangel.
the game has a pretty good tutorial so it will guide you pretty well on what to do... i haven't been on in a while i need to re-install the game actually