BeautifulSoup makes getting at attributes and values in xml really simple. I tweaked your example function to use these features.
import sys
from BeautifulSoup import BeautifulSoup as Soup
def parseLog(file):
file = sys.argv[1]
handler = open(file).read()
soup = Soup(handler)
for message in soup.findAll('message'):
msg_attrs = dict(message.attrs)
f_user = message.find('from').user
f_user_dict = dict(f_user.attrs)
print "%s: %s [%s @ %s]" % (f_user_dict[u'friendlyname'],
message.find('text').decodeContents(),
msg_attrs[u'date'],
msg_attrs[u'time'])
if __name__ == "__main__":
parseLog(sys.argv[1])