Quote:
I would say in our case dir is the riht one, cause we are friends. ihnen is the more formal one which you use with people you don't know or probably your boss 
Danke, mir geht es gut  Und dir?
Means
Thanks, I'm fine. And how are you? |
Ah it's like Japanese - they have formal language too depending on who you are talking to
Guten Tag Daggi
Wie geht es dir? Mir geht es gut