Editing for friends - a dilema.

A friend of mine has recently decided to write a travel book which tells of her and her husbands exciting travels around the globe, very specifically, China. It is a very exciting idea, and when she asked if I'd mind her sending it to me to have a look over I was overjoyed and agreed on the spot! Unfortunatley, this is where my dilema starts. Since she sent me the first draft of the first chapter and a sample synopsis she has been asking for my advice as well as my opinion. Now, this may not seem like such a difficult request, but before you can wholly understand the dilema, you must first understand the situation.

I refered to her as 'a friend of mine', but in fact she is a very old friend of my fiance and I am just about making an effort to get to know her too. She doesn't really have a background in fictional or travel writing. As such her ideas are amazing, but her writing could do with a little scrubbing up. This brings me back to the dilema. Do I tell her that I think her work is a great idea and that her writing is superb, or should I be honest and risk upsetting her?

Her aim is to get the book published, which with a little help and a fair amount of editing is probably not too much of a long shot, but I'm worried that if they send it off as is then their chances of publication are much smaller.

Now I have a group of friends who I studied with, who are, for lack of a better phrase, my writing circle. This is great because we know that when we give criticism that we are each trying to be constructive and helpful. We also know that we can say pretty much anything, for example if the work is really bad then we can say 'it's awful!' and laugh it off, without causing a rift. So what to do with friends outside of this circle? I always want to be able to help people acheive the things that matter to them, but perhaps this time I am better 'not being available?'