Piano home studio setup
It sounds like audio is much more important than video.
If that's the case, I recommend a Canon Vixia HF R600 (in some countries it's called the Legria HF R606) or a Sony CX405. The CX405 is worse than the Canon in indoors, low light situations like this one.
For microphones, small-diaphragm condenser microphones are your best bet because they have a flatter frequency response than large-diaphragm condenser microphones. Since your friend's room does not have good acoustics, I recommend a pair of the Line Audio CM3 microphones:
http://www.lineaudio.se/CM3.html
If you dont' want to order by e-mail (it took me more than a month for my Line Audio OM1 microphones to arrive), maybe this is a better place to order from:
http://nohypeaudio.com/lineaudioproducts.htm
Along with those two microphones, you'll need two boom stands, like these: http://www.amazon.com/Stage-Stands-MS7701B-Tripod-Microphone/dp/B000978D58/ref=sr_1_2?ie=UTF8&qid=1448219615&sr=8-2&keywords=on+stage+boom+stand
and two good XLR cables, like these custom ones: http://www.redco.com/Custom-Cable.html?orderid=71664&orderitemid=0&orderaccesskey=3edb5801648a3fc3
or Monoprice XLR cables, which should work fine: http://www.monoprice.com/Category?c_id=115&cp_id=11509&cs_id=1150902
Those microphones will need to connect to an audio recorder. Since he doesn't have a laptop, the Tascam DR-40 should work well: http://www.amazon.com/DR-40-4-Track-Portable-Digital-Recorder/dp/B005NACC6M/ref=sr_1_1?ie=UTF8&qid=1448220001&sr=8-1&keywords=tascam+dr-40
That should add up to under $700 USD. Although it's slightly over budget, it's all he's ever going to need for just piano.
I have two OM1 microphones, which are excellent, and they sound pretty close to the CM3 microphones. The major difference is the CM3 microphones are cardioid, so they don't pick up a lot of room noise, while the OM1 does. these microphones compete with microphones far above their price bracket. They're up there with Schoeps and DPA. I can PM you samples of the (amateur) recordings I've made with them.
Also, piano tips for your friend: His wrists are currently stiff and inflexible. That restricts his mobility - he should work on loosening them. His fingers tend to curve upwards from the knuckles - that results in unnecessary tension for his tendons. He should work on making his knuckles more prominent, so that his fingers curve downwards from his knuckles for more efficient and relaxed movement. The less distance your fingers have to travel, the better.

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