It is not illegal to make archived copies of DVD's you own, however, it does sound like your friend is taking the illegal route, as many do...To answer your question, it depends. Some retail programs on the market will make an exact copy of the original with a disclaimer placed at the beginning when you first watch your copied version. Before dual layer burners hit the market, you would have to span your copy across 2 4.7 GB discs. Many, if not most movies are Dual layered.
There are also many products, including shareware like DVD Shrink that can compress the information to fit on a standard 4.7GB dvd, and you will lose quality (A and V), although some people might not notice the difference. Also, many of these products will allow you to burn the movie only, and leave off the special features and menu's, in this case you can normally fit the entire movie, uncompressed, on a single DVD, including the DD or DTS track if you would like.
