Hmmmm....let's see there seem to be 2 issues here: (1) old vs. new technology & (2) up/oversampling vs. non-up/oversampling.
On the old vs. new technology I might be inclined to agree w/ your friend in that the CD chipsets have come a long way in a very short time & the cost is relatively low for these chipsets. IF implemented correctly, an inexpensive CDP is capable of very high performance for a very reasonable cost. Plus, the newer cheaper CDP might well rival an older hi-end CDP. Quite possible. So, older CDPs seem to be limited by the older chipset performance + the transport technology. Over on Audioasylum, Steve Nugent of Emperical was citing that a Costco Toshiba laptop had a really good DVD drive that could be used as a transport. This + a turbo-modded Benchmark DAC produced some superlative sound. I have no personal experience w/ this but I merely cite it as an example of a relatively cheap solution to redbook CD playback.
Re. (2): this seems to be a "religious" topic!! :-) there are 2 distinct camps & it seems that they are very polarized.
I think that it was incorrect of your friend to conclude that the dCS stuff bested his EAD gear just because of the high rate upsampling.
Your friend might like the sound of upsampled CDPs, which is an entirely diff thing & is just fine by all of us.