Windows 7 will not install on partition, is it true?

Well it seems that your friend does not have adequate information, or may be he hasn't ever installed any operating system,

because every operating system that exist on earth can be installed on a partition only condition is that size of partition must be either equal or more than the size required by the particular operating system that you are going to install.

So don't bother about this thing, and go ahead and install Windows 7 but do check the configuration of your computer because you need at least 1 GB of RAM for 32 bit, and 2GB RAM for 64 bit, 1 GHz x86 processor for 32 bit, and 1 GHz x86-64 processor for 64 bit, and 16GB of space for 32 bit and 20 GB of hard disk space for 64 bit.