(How) Can I adjust Elo playing strength of Fritz 12?

Is it possible for me to adjust Fritz 12's playing strength through adjusting the actual Elo rating of the engine? Right now I can only do "Friend Mode" as well as that mode that lets me pick a personality. What I want is an option that allows me to change just the Elo rating. Is there a such a thing? I've spent some time looking for it but to no avail.

Also, can I use Fritz to play with a friend on a different computer (LAN)?

I only play rated games against Fritz (to avoid takeback temptations). For rated games you can go to the Training tab, select Rated Game and on the screen it pops up, there's a slider near the bottom which controls the estimated rating

oh thanks I did not see that; is there such an option for an unrated game?

Not that I know of. There's some kind of handicap setting (I think in terms of pawn points) but I think the estimated rating setting only applies to rated games. In my experience it slight;y overestimates, compared to USCF ratings. E.g., Fritz12 on 1300 gives me much more problems than most 1300 USCF players I've encountered.

Does Fritz12 emulate human playing (at a certain rating) fairly well, or does it also play like CM where it plays a darn good game but blunders a few pieces here and there?

Unfortunately, there is no program that emulates human playing faithfully.  It may not be as bad as dropping pieces for no reason and then playing like a master, but none do a very good job.

It's because computers don't actually play chess as much as they calculate it.  So there's no real way to put a limit on the calculation without creating those times when it drops a knight.  The other way to do it is to having the computer play less than optimal moves at different times throughout the game.  But it has to do so nearly randomly because again it's not really playing and so can't reliably judge when a position should be more difficult and then blunder like a human would.

Kind of like how calculators don't actually preform math, they just have an input and output that happens to be mathematically correct (almost all the time).

I love schredder classic 4. It really looks like human game as I used to feel against real player.

now my other question, can I play against another person (LAN) through Fritz12?

I am not sure how it works on Fritz ( any Frittz. I was trying to find out that it´s ELO was on the stronges setting ( deep position analyse ) 

How ever, you can get a bit closer to your own rating ( more ore less ) if you get chessmaster 10. In both PLAY A RATET GAME and PLAY A FRIENDLY GAME and in TRAINING MODE, chessmaster offers a list of "humen players" 

Ubisoft ( who made chessmaster 10 ) collected som games from players around the world in the late 80´s and up to around 1990 ( I think ist was ) going from "monky " level ( I cant play chess at all ) to grandmaster ( chessmaster 10 ELO 2700 + ca. on max level. This makes chessmaster as a "OK" traning partner, when you find an opponent which is worthy to you.

In my experence, you go somthing like a 100 rating point over yours ( if you are around 1300 - 1350 play with opponent around 1450 - 1500 ca. )

I am not sure that you can make Fritz stronger, but you can give it a larger database, by going in to chessbase home site, and update the data´s. 

Good luck :-)