Will Facegen Modeller allow me to take the photo of a friend and add it to the skin of a character I'm working with, so it will look somewhat like them? 

I'm using the Victoria 3 Base with the body and head paks

I have done it, and it does work.  You can get a morph of your V3 head that looks pretty close to the features of your photo with the combination of the customizer and the modeller.  The texture, however, can be a slight problem.  Facegen doesn't support a texture resolution above 512x512, so when the texture gets generated from your photo it generally won't be of high enough quality to use in a V3 render without manual reworking of the texture.  It works great if your base model is a game character, as those tend to use lower resolution image maps.

**  edit .. attaching an image to demonstrate what I described above.  This is DAZ's David with a photo fit from a friends photos.  Note that the texture looks somewhat ok inside facegen, but when transferred into Poser for a render, it really only works when rendering from a distance.  **