The other posters are right, the track bars front and rear are easy to spot. It's the only bar that connects the frame to the axle diagonally. The sway bar has solid connectors like the silver thing in the pic above.
Your friends are right, a stock YJ Jeep with those removed/disconnected has a very noticable change in handling- off road, as well as on so just be careful if you go on the street without hooking them up. You will get used to it though, I'm on a sprung over Jeep with 35"s and no sway or track bars hooked up.
"Aut viam inveniam aut faciam" - I will either find a way or I will make one.
1995 YJ, SOA, D44/60, 35"s
2008 Dodge Ram SLT 4x4