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You are all correct, everything submited on the page should be secure, but what Juicy is saying is that friend feels nothing is being submitted on HIS website, which is true. It's like saying that adult pay sites should have an SSL when they are using CCBill. Most do not have their own SSL because nothing is being entered on the non secure page, they are directed over the payment provider's website, which is secure.
So, your friend is technically right, but like you said, if he plans to use his own merchant account at some point, he will need an SSL. At this point there is nothing to secure. The add to cart and order now links will all take the customer to PayPal where they will login securely.
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~Kacy 
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