He mentioned this to me yesterday while he was picking up the wheel, but we both had to rush off so I didn't get a chance to discuss it with him.
You are correct, if it was a gearing/tire difference it would be off a percentage, not a constant 7mph fast. It is possible that work has been done on the cluster or something and the needle was bumped or moved. Is it at 7mph when it should be at zero? Does it go all the way to the stop when off? You can carefully pry the needle off (a fork works really well to pull it straight off). And then place it back on in the correct position. I have found the best method is to pull the clear face off the gauge cluster, remove the needle, place it back on, but not push it down all the way, take a short drive and compare either using an OBDII scanner or GPS, and then make any more adjustments if needed. Compare the speeds at 25,35,45,55 rather than at just one speed to be sure you get it right. When you have it right push it back down, but not too far, if you push it too far the needle may rub the face causing it to drag, reassemble the cluster and you are good to go.
I actually had to do this to my father's Nissan a couple years back, I have no idea how, but his speedometer needle broke off, I tried to repair it, but the plastic was so brittle it crumbled in my hands, I fixed it using a little chunk of rubber and the end of a zip tie glued to it and painted white to make a needle, he says it's still working great and is spot on, redneck repair award of the year if I may say so my self.
I seem to recall your friend also saying the truck was having issues with O/D. It is possible that the VSS is going out, a malfunctioning VSS would mess with O/D and ABS as well, but normally when it goes, the speedometer doesn't work at all, or intermittently, not a constant value off.