Really weird. XVid decoder should jump in when properly installed without further adjustments.
As player says that XVid is unknown codec, wrong 4cc is unlikely. It would be DivX or the likes.
Try to use ffdshow filter. Find it here:
http://sourceforge.net/projects/ffdshow
Or look at
http://www.doom9.org for the d/l link.
After install uncheck XVid codec use on codecs tab or to be more precise: the right checkbox in that line, so instead ffdshow will do the decoding (apart from all the postprocessing and filtering capabilities I have to advertise here again... :) ).
If this is not the solution, your friend has somehow screwed that movie file.Believe me.
Another thing you can try is to analyze file with Gspot (look at doom9 again). If you do not understand what it is telling you post results here.
We'll help.