You will not be able to act as dns server for them without getting approval from the ARPA. Also, if you do wish to do this you will need at least 2 servers for redundancy, preferably located at different geographic locations. You can host websites, but to do this you will need a fixed IP address from your ISP. This will cost extra, and some providers will not do this. You may also need to change to a business account. The bind name server will be usefull for setting up an internal dns, that way you can test internally to
www.your.friends.domain pointing to your internal private address, and see what is seen from outside via your public address.
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