ok, as a long time guitar player i can give you some advice on both playing and mic'ing the classical guitar. my old guitar teacher seems to like the idea of "letting the guitar breathe". basically his idea is to pretty much just have either a bidirectional, or omni mic set up maybe 3 feet away from the guitar set up maybe 1 and a half meters from the ground. this captures the overall tone of the classical guitar. it seems like either u had set up that mic on your recording fairly close to the guitar, or u were in a dead ass room. when u get too close with the mic to the classical guitar, the sound is focused less on the overall tone and more on the area that its pointed at. the classical guitar, u have to remember has a lot of different areas that produce sound. not just the sound hole, thats a common misconseption. the sound hole gives out all the bass of the guitar, the body gives out mainly the mids, and the fretboard is pretty much just all treble. with a classical guitar song like beetoven 999 or whatever that song was, you would probably prefer to capture the overall tone, so u should go for a more live room, and an omni mic set up further back. but keep on truckin bro, trial and error. also your guitar is way out of tune, get the guitarist to work on tone and dynamics. mostly tuning. i played this song last year for a university assesment, i think u may have gotten one of the passages learnt wrong. then again some scores for old music is a bit messed up. anyway, thats all i got for you. funbox awayyyyyyyy.
...and you did say it was his wife's childhood guitar, so keeping it in tune may very well be an issue...or perhaps this is as your friend intended it to be tuned?