I tried searching and from what I've read, it seems that players will only be grouped with others of similar level. What if you have a group of friends or clan. Will there be a separate clan matching system that opens this up? What if one person in group is level 10 while someone else is level 25?
This applies only if you use the automatic matchmaking system. There's nothing preventing you from joining a friend's game, although in that case, if you are higher level than him/her, some of your character's abilities will be unavailable to balance things out.
Say a level 20 (max) player joins a friend's game (lvl 9). Since they are playing a "bracket 5-9" game, the level 20 player will not have access to any of his level 10+ abilities.