If your friend is going to cover the wall with something along the lines of a paneling then there really is no need to repair or to seal the damaged drywall. You only need to make sure that there is nothing protruding from the surface, which can easily be done by sanding with coarse sandpaper. The adhesives used to adhere paneling and the like will easily grab whats left of the paper. The only areas to be cautious of would be where the paper is gone and the core of the drywall is exposed. If you intend to paint or use wallpaper then you should start by sanding with the same coarse sandpaper to be certain that all the loose paper has been removed. I have heard of the floor wax trick but I've never tried it, I use Zinnser's "Guardz" to seal the paper, allowing it to dry for several hours, then I use a "setting type" joint compound to mud it over. Normal, pre-mixed compound can be used if you wish to make it easy on yourself. It is better to use several very thin layers of compound rather than to "goober" it on and try to sand it off. Sand the patches smooth and then prime and paint.