Your 'friend' seems to have got it backwards, show him the verses from James about faith without works is dead. Also when Jesus saves us, its for good works which God has ordained for us to do.
I have known some people like this, thinking they can get away with anything because God 'favours' them with grace. That isnt true, it may seem like that on surface, but He knows everything we do and we each have to give account on judgement day.
I agree, though I my self not perfectly Holy, but I am not agree No matter what you do after you accept Jesus Will be forgiven, than ok to have a sex with other woman.
Seem to me adultery in the heart is little different compare to physical adultery.
Last year i meet a man call himself Christian, and talk about have a sex with other woman, i warn him, dome woman in this town practice free sex, you may get aid, he say I always bring protection with me, in case I meet pretty woman
A Lot of Christian believe save by grace mean what ever you do, only reduce your reward but not your salvation