I’ll try to give you a biblical answer, since nothing I’ve read seems to have given any hope at all.
I will begin by clearly stating I am a believer and as such I believe the Bible. If you don’t believe the Bible is God’s Word, then this post will mean absolutely nothing.
Now, on to the answer. The biggest problem with almost everything that has been stated here is everyone is beginning upon a wrong premise, that being “if God exists, then He can do anything He wants.” This wrong premise is one of the biggest hinderances to people understanding “why does God allow bad things to happen.”
The problem is people are confusing God’s ability with His authority. God has the ability to do anything, He does not, however, have the right or authority to anything.
If you study the Bible, you will find one of the most unique characteristics about man, compared to any other creature, is that he has a free will, including the right to go against God’s will. In the Garden of Eden, God gave man authority it the earth (Gen. 1:26) with only one stipulation "don’t eat of a certain tree. It was man’s free will that disobeyed that command and listened to the devil. In doing so, man gave his authority in the earth to the one he obeyed (Rom. 6:16).
With man choosing to obey the devil over God’s command, now the devil has certain legal rights in the earth. Not only that, but now there is a curse in this earth. Not because God allowed the curse in the earth, but because man used free will to obey the devil.
Because of this, God cannot just do anything He wants to do. God is a just and righteous God, if He gives authority to man to over the earth, then if man chooses to give that authority over to the devil, God can’t rightfully stop man from doing it.
Why do bad things happen? Bad things happen because this earth is cursed. Why doesn’t God stop bad things from happening? Because without man using his free will to agree with God, He is limited in what He can do.
The whole point is, God is limited in what He can do in the earth without man’s agreement. That is the whole idea of faith. Faith is man using his free will to agree with God’s plan. Faith (believing God’s Word) is the connecting of man’s free will with what God desires to do on the earth. Faith is what gives God the authority to use His power.
Clearest example I know of in the bible is found in Mark 9:14-23. A man brings his son to Jesus and asks, “If you can do anything… help us.” Look at Jesus’ reply (verse 23). He said to the man, “If you can believe, all things are possible to him that believes.” Basically, Jesus was saying, “It’s not about my ability, it’s a matter of what I am able to do. I need you to believe.” The man believed and Jesus healed him.
To sum it all up, if you believe the bible, then you’ll see that bad things happen not because God is testing you or because it’s part of His plan, but because the world is cursed and there is an enemy that does these things. However, if you will believe what God has said in His Word, you give Him a right to use His power to keep you out of these things and deliver if they come on you (like the healing of cancer). It is absolutely God’s will to heal your friend, but she has to believe God. And sometimes, others can believe for them as well. However, you’ve already stated what you believe, “I’ll be straight up and bet money that she dies” that means you aren’t going to be any help to her at all. (Please, whatever you do, don’t talk like this in front of her. It will rob her of her ability to believe). But if she will believe, she can be healed. If she doesn’t believe God will heal her, then she may die. It will be tragic, but even in that, she will be in heaven.
Obviously, this is a whole study that goes through the entire Bible, but I’ve tried to give you the basics in as short an answer as possible. Only other thing I can say is don’t blame God when bad things happen, and don’t let people (even Christians that don’t know any better) tell you God is the one that gave her cancer or that He doesn’t care and is indifferent. If you study the Bible, it’s simply not true. He wants to heal and help, but people have to believe.