I used to work with a few women at our college rec center a few years back as a favor to give them knowledge of proper nutrition and exercise. All the girls I worked with all told me they didn't want to lift heavy or do compound lifts because they were scared they would get huge. One thing I would do that helped out a lot was to explain weight lifting in terms of survival.
What causes muscle development, simply from a lifting perspective? Muscle overload. You can only achieve muscle overload by lifting heavy. Your body doesn't know it's the year 2009. As far as your body is concerned, it is the year 10,000 BC, and instead of doing bench press, you're pushing a hungry sabre tooth tiger off your body to survive.
Sounds ridiculous, but this makes sense. When you lift heavy, and your body senses that you're really pushing hard to get that last rep, your body will send a variety of things to your muscle group to endorse muscle development (blood, water, oxygen, hormone response, etc). As a result, your body will want to develop stronger, denser muscle tissue to prepare itself for future abuse. It doesn't want that sabre-toothed tiger to kill you. It wants to be able to defend itself.
If you're doing dumbbell curls with a 2.5 lb dumbbell for 20 reps a set (see that a lot with women), you're only tiring the muscles, and at the same time your body recognizes the fact that you COULD lift more weight if needed, and as such muscle overload is not achieved.
You have to convince your friend that weight lifting is really just a future investment into fat loss. Most of us know that it takes more calories to fuel muscle vs fat. So then, if you achieve muscle overload, and your diet is consistent with BMR recommendations, then your body composition should change, and you should lose body fat%. This won't necessarily mean a change in overall size of the body part. She's not going to get huge.
I've actually witnessed a 22 yr old Hooters waitress training for their annual swimsuit competition get in great shape using the theory of heavy lifting with a rep range of 4-6 per set. She went from 24% bf down to 18% in just 2 months. I know a lot of fitness competitors will get as low as 10-12%, so this doesn't seem that impressive, but at 18% she kept a lot of her body proportions while looking a lot tighter.
She was on the Hooters calendar 2 years in a row, so it worked out for her pretty well. I think that keeping body proportions consistent while cutting bf is the prime objective for most all women (and men too, really).
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Building muscle will raise her metabolism and allow her to burn fat quickly. And, she won't be skinny fat. I'm sure you'd like for her to look tight when naked ;-) And, it probably wouldn't be so bad when she got caught naked dancing on the bar. At least she'd be hawt.
