Idea generation - talking to friends at other funds

I know funds have their own screeners set up or have an existing base they want to track, but during my internships I've also seen my bosses get calls from friends/bosses call their friends at different funds and start talking about stuff they've been looking at or asking if there's anything interesting. How does this work? I understand that you're often made to sign agreements to not share stuff, but where is the line drawn between stuff like this and what you can't share. If I'm starting at a distressed shop and have a very good relation with my old boss at another distressed fund, do I just call him one day and start talking about interesting stuff and see if something of interest comes up? Is this how some ideas are sourced? Is this common practice?

What I'm trying to understand is different sources of idea generation. Screeners, own analysis from reading about stuff, shit like this, sell side calls, etc. I've done tons of sell side calls during my internship so know how to strategically go about asking for something interesting besides the stuff we are scheduled to talk about so probably won't just go to my old boss and say "hey do you have some money making stuff you're working on..."

Even with sell side often times as expected, decently interesting ideas have come from MDs from top groups that cover stuff for years and know the in and out of the industry, not some random ER guy so that seems to be a hard place to source stuff. Is talking to friends common practice to maybe source some ideas? In an environment where getting an edge is almost impossible due to sources available to different funds, how are people sourcing ideas?