Hi ladymacbeth, and welcome to WebmasterWorld. Sorry it was necessary to remove the names of the three sites you mentioned, but, as you can read in the Google Search Forum Charter
[webmasterworld.com], we don't allow the kinds of specifics you posted, nor do we allow public site reviews... for all sorts of good reasons, including the protection of webmasters.
That said, a few things I noticed that were characteristic about the domains you posted are possibly worth mentioning. I noticed that your friend's site was an exact match domain... four words, no hyphens. It's the kind of domain name that I would guess was once parked. I mention this because history of parking is a consideration I've seen come up with regard to sites I know of that have been dropped in ranking and since restored. Something perhaps to look into.
I agree with you about the tripod subdomain site that you say replaced your friend's site... It's crap.
Did the site that you mentioned that used the unnamed online link building service receive a Google WMT notice of "detected unnatural links"? Google is sending these messages because they want webmasters to know what's happening and to have a shot at fixing things. If no notice was sent, then... on this update anyway... it's likely that the problem wasn't linking. See this thread, among others here: [webmasterworld.com
It's also probable that this update is far from over. For several queries I've monitored for quite some time and have rechecked for this update, there are simply too many cookie-cutter commercial sites up top to reflect what I perceive as Google's traditional goals.
The algo had previously been keeping some great non-commercial sites, eg, sites that had never surfaced at all in Bing, up top on very competitive searches in Google... perhaps, I thought, to lend variety to serps that were monopolized by 800-lb gorillas. These are now sitting on page three or lower. This seems to be very contrary to the road that Google had been on. It also doesn't support the AdWords conspiracy theory, as these non-commercial sites aren't going to buy AdWords.
It looks to me like, on some queries, Google may be trying to make distinctions among branded domains. Just a guess. I'm expecting to see some large shifts yet.