Wants to start a website where he sells products/items online... He makes it sound like he's going to get money easy. What I want to know is what kind of advice should I give him. Does he have to register somewhere as a small company? Tell me all of that jazz!

So a priest, a rapist, and a child molester walk into a bar, and that's just the first person...

First off , there is no easy money. If your friend thinks just having a website is going to put him on the corner of "Easy st." and "Got It Made ave.", then he doesn't know anything about this business, and that's the first step to possible failure.
There are many ways to get in the picture without loosing your shirt, and learn as you go along.
No you dont have to neccessarily get a business license.
I could be a lot of help in this subject, because when I started out, I though "OOoooo, Easy money!"

Feel free to email me , maybe I can shed a light on what he is in for, and some of the opportunities that are available to him.
MY first reaction to a post like that is:,if you don't have a budget to hire people who know what you don't. then learn as much as you can before you put up 1 dime, and then learn some more.

Step one - your friend needs to begin doing for him/herself. Beginning right now. You need to get out of the picture and let your friend learn by doing.

So why does "your friend" need you asking questions?