Can a friend of our class, be added so he can see our website.
Would I need his email and issue him a password, what section would I set this up in..

Add as a guest. Needs an email and password. He could do that himself once you enter them as a guest.

Manage Classmate, Enter/Edit and so forth. Pick Guest

I'd recommend you change your "Classmates/Teachers" page to a different title, like "Classmates/Guests" then add your friend to the Guest Members section. Right now, your Guest Members section is limited to teachers. Your Guest Members section would then include teachers, friends, and whoever else you wished to include, such as alumni from other classes, former classmates, staff personnel, etc.

Your friend would then join your site just like the teachers have. He'd need to log in to the site, thus requiring an email and a password, to see any pages that you have password protected.