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The screen may still be good, provided the water didn't corrode the contacts or seep inside the layers... Won't know until you try!
Does your buddy not have insurance on the phone? If not, hell, give it a whirl... I mean, what's the worst that can happen? You end up with two useless Droids?
I'd recommend doing a Google search on the teardown of the Droid first though, apparently they've hidden some of the screws, and some are hard to get to.
G'luck!
All the parts are interchangeable. I would wait until the phone is dry and then see if it powers up and what exactly is working. In my experience with water damaged moto droids the LCD will fail more often then the motherboard. Check to see if a computer can recognize the phone when plugged into usb. If the motherboard is dead there is a good chance the LCD is also. There is also water sticker (not the red/white one) on the motherboard that you can see if you take the battery door off.