Should a lecturer be friendly with students? I have been thinking about this question for a while and did a few googling here and there; but, didn't get anything good. Probably, academia could help.

I am early in my teaching career as a lecturer (I am just 25 now) and also working towards my PhD.

My classes are very interactive and I sometimes become very friendly with my students. Sometimes, I make difficult theory so simple for them to understand in their own language or sense. Maybe that is good for students. However, it kills a lot of my time inside the class.

Sometimes, I can feel that students are trying to take undue advantages of this friendly behavior of mine. They try to become very frank when the papers are evaluated. They just sometimes make my time horrible so that they get a better mark than they deserve. Is it the outcome of my style of teaching?

In general, should a young lecturer be friendly with his/her students, either inside a class or outside of class?

I have felt that here students are more focused on grades than learning something new. (I am making it generalized; however, ratio-wise it is true)
Krantz in How to Teach Mathematics does actually want to become friends with his students (Sec. 3.1, Breaking the Ice):


  Since I so enjoy a class once we have all become friends, I find the
  period of tooling up to that happy steady state generally too long and
  too painful. What usually happens is that there is a period of two to
  five weeks during which the students look at me as though I am from
  Mars... You should consider ways to make yourself seem like a human
  being to your students... Find some way to open up to your students so
  that they will open up to you... My view is that you should show
  students from day one that you are a person, and that you are going to
  spend the term doing your best to communicate with them.


But elsewhere gives this warning (Section 2.10, Grading): 


  You do not want to develop the reputation among students as an
  instructor with whom grades can be negotiated. I've had this rep, and
  I don't know how I got it... This process is unpleasant and (can be)
  degrading both for you and the student. Doing a careful job of grading
  in the first place, and posting carefully written solutions for
  students to see, can help to assuage much of student discomfort with
  grades.


Now, Krantz is a teacher "of long experience" (Sec. 3.1), and I can see this being interpreted differently/incorrectly if you are close in age to your students. Also, this will vary based on your institution and quality/maturity of students that you're getting. In my experience at community colleges, the strategy I was forced to start using early on was to be relatively strict at the start of the semester (adamantly not allowing any bit of variation from the course policies when students test them), and then becoming a bit more flexible and friendly later in the semester. 

Added: More Krantz (Section 5.9, Begging and Pleading):


  It really is true that if you look and/or act like a student then
  students will find you more approachable. They will more readily come
  to you with propositions that they wouldn't consider broaching with a
  more wizened (or older) faculty member. In short, younger faculty are
  more vulnerable. This is one reason for dressing differently from
  students and maintaining a slight distance. Again, this may sound
  cold. But I speak here from hard personal experience.