How does electrum work to find other electrum sellers/buyers?
Electrum is a wallet. It stores the private keys to your accounts. It works (for now) with Bitcoin.
Is that part of the system decentralised, or is that part of the system centralised?
Electrum is stored on your device but relies on servers for transactions information. Some wallets store the entire blockchain but electrum does not. Wallets that do not store the blockchain locally are called lightweight wallets. Lightweight wallets have to query their servers each time they are run.