Your car, your oil, THE warranty. It spells it out for you in the owners manual. So you believe an engine should be replaced due to neglect, abuse, and using an oil that doesn't meet Ford specs but ignore the manufacturers recommendations because you "think" it's a superior oil?
How can you disagree? If you ignore what is told to you where is your arguement?
If an engine is not one or two but five quarts low, that means nobody checked the oil and it was also pushed very very hard.
So whether or not you agree is somewhat irrelevant. It's business. You can't just do whatever you want to a car while it's under warranty and cry fowl when you didn't do what you were told to from the beginning. You have a responsibility to Ford to do the right thing. Did he do the right thing? Obviously not.
I would also bet had the car been treated properly with this oil, he probably would not have ended up in that predicament. There is more to caring for an engine than using superior and or recommended oil.
It just winds up to another expensive life lesson. Play by the rules you will win the game. Write your own rules and you will be caught cheating.
You have a responsibility to use fluids that meet Fords spec and if unsure you research or ask. Crying that it's unfair is a bit unbelievable, really.
From what OP stated, Ford said the type of oil was the only factor for denying the warranty work.
Based on that, and the above information regarding Royal Purple and Fords standards, the "Friend" has a case against said dealership and should press the issue. GL. I'm glad I've never had to deal with Shitty Service departments.