How to Join Games with Minecraft Pocket Edition 0.7
There is no button for it anymore. Local games that have the local server option turned on automatically show up in the Worlds list of other players.
One of you should start up a world while the other stays on their Worlds list (the menu you see after pressing Play) and waits for it to appear at the bottom of the list. It should be blue in the list.
I managed to get it to work between 2 iPhone 5's and an iPad 3. The local server game is down at the bottom of the list, after all of the really old games. Hope it works for you.
Hit play and scroll down to the bottom of the list. There will be a world that is the name of the person you are joining in blue letters. Click it to join.