Drag the iCal Event off of your calendar and onto the Mail icon. A new email message will open with the details of the Event. If you have already started a message, you can drag the iCal Event directly to the text of the email.
Dragging the iCal Event into an email also worked with web email such as Gmail or Yahoo! mail. For that matter, you can drag the iCal Event into any text area such as a word processing document.
There is another way to send an iCal event via email that will add the Event directly to the recipient's iCal calendar. However, the success of this method varies widely among email clients. Gmail would either add the Event to its own Google calendar or let you download it to iCal. Yahoo! Mail just showed gibberish. I'd only use this method if you are sure that the recipient can accept the sent Event.
To use this direct technique, drag the iCal Event to the Desktop and then add it to the email as an attachment. The recipient can click on the attachment and the entire Event will be added directly to the recipient's iCal calendar. Again, I'd test this method with your recipient before sending an important invitation.
One last item: When you create or edit an Event in iCal, you can add Invitees. Doing this is basically the same as sending an Event as an attachment, except you don't get a chance to add any text of your own to the message. Adding Invitees has the same problems as attaching an Event: You have no way of knowing how the recipient's email client will handle the Invite.