Paul,
I kinda have to go with Dave55 on this one... One for liability's sake, & the other reason being you might save this guy from really getting over his head in the future.. Just my opinion, but as a friend I try to put things as straight as possible to avoid reprocussions in the future.. (IE, their house burning down!) While I try to do it in a jovial way.. I make sure I get my point across. [Linked Image]
Just kinda walk through with him while you're writing things out & explain why you should'nt do what has been done... This is the way I typically go about things when I'm doing home inspections also.. At the end, tell him he's free to get another opinion if he wants.. But I think, as a friend, he'll appreciate you being candid with him

-Randy