Dreamweaver uses the <blockquote> html command to create indents. It's super easy. Just select some text, and select format->indent. To remove this, select format->outdent. That's all there is to it. You can use the menu command or you can type the html by hand. The result is the same either way.
A sample follows. View source to see how it works.
Here is a sample paragraph without an indent.
Here is a sample paragraph with an indent.
Here is the code:
<p>Here is a sample paragraph without an indent.</p> <blockquote> <p>Here is a sample paragraph with an indent.</p> </blockquote>