Clearly Oblivion is what your friend is looking for. I myself consider it distinctly inferior to Morrowind, but it is a hoot nonetheless.
The Gothic series is also good, but you should be warned that it’s a hard core RPG, by which I mean that you’d better love a steep progress curve. Most of the world of the first two games you have to work hard to be able to visit without getting murdered pathetically. For a hard core RPG player, it’s a very satisfying resource management and critical path hunt. Others would probably find it tedious. Gothic 3 is a lot easier, though, but it runs like total crap even on my recently upgraded computer.
Knights of the Old Republic is very good, though not nearly as free and open as the something like Oblivion. Few games are. But its story is excellent and you can run the combat as turn-based. Knights of the Old Republic II is worth playing once you’ve run out of other games.
Deus Ex is a great game, though I should report that I recently overheard some FPS-type players talking about how great a game it was and they were surprised when I described it as an RPG. Some RPG players consider it to have light RPG elements at best – fairly little actual character building and resource management and only a few key points at which you make choices as to your role in the plot. But in fulfilling missions, the sense of freedom you get in your critical path hunt is amazing. Deus Ex 2: Deus Exer is also fun for people who have already beaten Knights of the Old Republic II.
Mass Effect is a great game. I love the look and feel of the world, and the fact that Bioware troubled themselves to fill in the science fiction details about how the technology worked, the planetological description of the worlds you visit (though every planet you land on acts like 1 g whatever its actual gravity), and I appreciate the fact that the whole thing is done in metric. It’s not a sandbox game. You choose your path, but a lot of the side-quests are virtually identical shootouts, and the game automatically adjusts the difficulty to match your current power level. It has something of a Progress Quest vibe because of this. You can level up, but it’ll make no difference in what you’re able to accomplish next. The computer auto-loots for you, with random but level-appropriate gear just teleporting itself into your inventory each time an enemy drops. You’ve got a good-and-evil sort of morality, except I’ve played through as both and found that it makes almost no difference in the dialogue paths, and playing as a Renegade I nearly pinned in Paragon points anyway, because advancing the plot is considered good. Still, I can’t wait for Mass Effect 2. It was a lot of fun, and frankly I’d really like to encourage more science fiction RPGs.
Vampire the Masquerade: Bloodlines is a must-play for any RPG fan. Again, not a sandbox game, but it does convey a strong sense of freedom within the relatively small world you are given to bustle in. There is little in the way of futzing with equipment, but the actual character building is fun, and has a real and noticable effect on how you are able to proceed next. The atmosphere and situations range from wryly comical to deeply disturbing.
System Shock 2 is the living end. It’s the bee’s knees. It’s far-out and solid and out-of-sight. It’s both a gentle but miraculous household cleanser and cure for dandruff. System Shock 2 loves you and accepts you for who you are.
Neverwinter Nights 2 has the advantage that it can be played a lot more like Baldur’s Gate, though you kind of have to go out of your way to make using strategy more useful than just running up and whaling on enemies. The story is good, though. But if its non-linearity you crave, the Mysteries of Westgate add-on is supposed to be much more in this vein.