I can imagine how painfull it is for someone that dedicated to the art.But if he's getting the same prognosis from several doctors he'd better listen to them, wouldn't you say?
I can recall a statement made by John Stevens sensei:"If you can walk, you can do aikido." Also he said that he once had a one armed man in his class and with adjustments to the techniques he could practice along with the group.
Several techniques can be done with one hand.So, your friend is down to those two alternatives you stated wich are fine, because I think he can't do much more in order to keep his back ok.
Never taking ukemi; well you do miss a great deal of aikido because the true execution of a technique can't be seen, it has to be felt.So in that way you're missing a piece of undestanding of the technique itself, and from aikido.
It's really sad for your friend.
Taking ukemi is a very important element of aikido, I'm sorry.