I think there are a few points that i deem that your friend has done wrongly, maybe i can try to point them out (forgive me for being frank)
(1) Your friend has showered the gal with large amount of money since the start. $500 to $1k a month, that's a lot of money for the gal and her family. She and her family will think that your friend is very rich, and of course, they will want to marry your friend because they think that they need not worry about money after the gal marries your frd.
(2) Your frd is really native to believe the gal when she is pregnant. The gal works in KTV and i can be very sure that she sleeps with more than 5 different customers a month. So when she's pregnant, how to be sure the child belongs to your frd. DNA test will surely help.
(3) The mental test conducted at the mental hospital in HCM is really a simple test. When i got married in Vietnam, i also went to the same hospital for test. The doctor only asked me one simple question ` Are you really happy to marry this vietnam gal?'. As for my wife, they asked my wife how she communicates with me, and whether she really wanted to marry me... etc I wonder how can anyone fail this test. If she really failed the first time, then maybe the doctor finds her motive for marrying a foreigner questionable.
(4) As your frd has shown the gal that getting $500 to $1k a month was so easy, its difficult for the gal and her family to accept that maybe their financial support has come to an end. Its like a singaporean who used to earn $5k to $10k a month losing his job and income source all of a sudden.
bro, i am still waiting for the other parts of this true story. Hope that what i have pointed out make some sense.