That arresting officer probably meant if he can be turned on to a dealer by your friend which is what they're really looking for then your friend might get a break for helping them get to the source. Generally the way it works in situations like this is if they have a big enough hard-on for you, as in they're REALLY SERIOUSLY out screw you and make sure something sticks, they'll pile on any more serious charge that even remotely applies to the situation right from the get-go so the ADA has the leverage and you're more likely to have to plea to something and/or give them what they want. (By the way, getting up and walking into the house when you see the cop cars can give them just a tiny bit of motivation to make your situation worse. For all they knew you were going in to grab guns.) I've seen worse, expectially in situations where someone runs or fights. One or two baggies becomes 'capacity to store in quantity', which leads to 'manufacturing or possessing with intent to manufacture or deliver, stuff like that. Keep in mind most court systems also don't want to spend the time and resources to go to trial over a non-trafficking marijuana charge so it's in their interest to get you to plea to something and accept some form of punishment before that point.
The other guy is an idiot and I think they caught him up to something a bit more than just having a little bit in his car. They caught him with a large quantity, or they caught him buying or selling, otherwise I can't imagine they would have found it worth it to watch his house.
Whatever anybody's feelings about pot, your friend deserves to be where he is if for no other reason than he was too stupid to keep it inside the house. At minimum he needs to dress well, be SUPER respectful and apologetic in court, and try to pretend to not be a worthless looser unless a good lawyer can find anything that the cops did procedurally incorrect. Judges can be dicks. If they sense that you're not sorry, you have no respect for the court, or that you're just a pretty worthless human being in general they'll put you in your place in a heartbeat. What may or may not happen in the end will vary depending on your state's sentencing guidelines and whether or not this is his first screwup. But in general I can tell you in an awful lot of these cases if there's no serious criminal history the bullshit charges go away and someone pleas to a simple possession and/or paraphernalia charge pre-trial and ends up on a couple years' probation.
