I agree with the previous answers. There are a few other alternatives like "We knew each other way back when", which is informal or "We knew each other a long time ago". Hope that helps.

"We've known each other for ages" is also a more natural alternative.

The first is correct. However, I'd be more tempted to say something like "He and I go way back". The second is not correct.

Once you fix an error in the second sentence by changing "know" to "known", I like both sentences. I would improve the second sentence by writing "since way back when": "We have known each other since way back when." Less colorful but grammatically simpler is "We know each other from way back." However, "We have known each other from way back." is easily understood, sounds colorful, and many people would indeed say it that way. It has slight imperfections but it cannot be called a mistake. The language is flexible enough to permit some imprecision. A listener will naturally interpret "from way back" as "for a long time".

The first one.