Well you could copy the disc ya, but youre better off getting a copy from the internet. Find it online, sorry cant be found on this site, then patch it with the newwest update which is in this forum. It will work better than the "legit" version your friend has. Magic III is okay, to run the hdd all youd need to do is have the hdloader disc sitting in the drive and it will boot up to the hard drive. If you want to be a little more advanced, you can do with a Matrix Infinity or Crystal Mod, which allows you to boot from the memory card, or from the hard drive itself so it loads faster, and doesnt have to use the laser at all to do it. But its all up to you.
SCPH-50001- v9 NTSC - Matrix Infinity v1.38
250GB HDLoader Dev.1 MC