I play the Natural Scale-how do you apply it to chords for riffs, etc?

With the CAGED system there are two main things you need to learn. The first is the order of the chords always remains in the same sequence C A G E D starting from the C or if you were starting from the G then the order would be G E D C A because after the D chord it starts over again from the C.

Another way that helps with ear training is using the circle of fifths to pick out the notes of the chords for scales :



Just don't DRINK a circle of fifths!!!

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The CAGED system IMO is a great way to start out playing. It gives you a basic understanding of how a fretboard works from the 1st fret to the 12th. But if you are serious about learning the guitar, I would study everything I could get my hands on.
It use to be that you learned from instructors, friends, and from listening to songs over and over until you got it right. Nowadays you can go to youtube, tab transcribed websites, and there are a few decent sites dedicated to learning guitar. They teach everything from scales and modes to speed. I have a few of the Lick Library dvd's, Eric Johnson's Art Of Guitar, and I still trade what I learn with friends and I still listen to the song I'm learning over and over again.