You have been asking general questions and we have been giving general answers leaving you to work out the specifics for your situation, which isn't working.
So we need more detail.
What is the complete setup of devices on your local network? Not just yours but his as well.
Will there be any local traffic between devices connected to the router? File sharing? Networked printing?
Or will it all be to and from the Internet?
If so the limiting factor will probably be the throughput of the DSL connection, not the wireless network.
How is it connected?
If it's on a USB port it isn't an issue unless the other guy prints to it via your PC. Which is a Windows feature that can be turned on or off.
For security purposes, turn it off.
If it's connected to the router then remove it and connect it to a USB port.
If it's one of the latest wireless printers I have no experience of these but I would expect them to use up bandwidth because they use the same wireless adapter on your PC. I would guess they have some kind of encryption to make sure your stuff doesn't appear on somebody else's printer or vice versa
Also for security purposes turn off file sharing which is another Windows feature.
That's not so much interference as contention. It's just devices sharing the same channel. Only one can talk at a time. It's the same situation as using your laptop at Starbucks.
If it's his router you haven't any control over how many devices he has connected to it.
The amount of concurrent access to all devices including his and yours makes a difference to the speed you will get out of the wireless link.
If all you are both doing is connecting one computer to the outside world then you probably won't notice it.
But even if you do, it's his internet connection you're using for free, and his router. You're stuck with how he has the encryption set up, what its pass key is, etc. You might suggest he uses the strongest possible with a phrase you and he can remember but that's all you can do - ultimately it's up to him.
In fact the limiting factor will probably be the DSL connection not the wireless because that's the slowest link in the chain.
You'll find that those of us with fast wireless use it for things like shared networked disk storage which need the speed.
It depends on the traffic. If you're both doing downloads at the same time, either files, large web pages, high volume newsgroups etc, they will slow down because you can only get so much bandwidth out of a link. Bit torrent downloads can slow everything down.
Below a certain signal strength there will be more retries. Because the level of the radio static doesn't change.
Yes.