QuickMail
You can e-mail the entire class or selected students using the "QuickMail" feature. Navigate to your course and look for the QuickMail section near the top right of the screen. Click on "Compose Email" and select the recipients. There is a button to "Add All" or you can select individual people to e-mail. Compose your e-mail and click on the "Send E-Mail" button at the bottom of the screen. QuickMail keeps a history of all e-mails you have sent which is available right under the "Compose Email" link on the course page.
By default, QuickMail is not available to students. If you would like students in your course or organization to be able to use QuickMail, send a request to help@swarthmore.edu and the settings will be adjusted.
News Forum
You can use the News Forum in Moodle to create announcements that are displayed in Moodle as well as sent to the students in the course. Every course is created with a News Forum in the top block. Adding a new topic will create a post in the News Forum, add an entry to the "Latest News" block in Moodle, and email your students.
Remember that any posts you make to the news forum will get emailed to your students (even test posts!).
Faculty Services
Faculty Services provides a listing of all the emails for the students registered for your course. You can copy and paste the listing from Faculty Services to your email program. Some people create contact lists for their courses using this feature.
When to use which feature?
For a general announcement, any of the above methods are fine. The News Forum provides more places for an announcement to show up, which is good for important events such as due dates for papers and not as good for reminders about who is bringing a snack for tomorrow's class.