I don't know how they can fine your mate in the scenario above.You were at a house and borrowed a car, is it not fair to assume the car was being "kept" at the house and was unregistered? There is no law forcing him to register it.
The only way he could be fined is if he goes to drive the car home once you have been pulled over in it. If he gets it towed, no problem. The police need to prove he was driving it, just because a car and it's keys are easily accessible at another persons residence does not mean it has been driven knowingly unlawfully.
For example my car had been trailered ages and ages ago to my mothers house, placed in the driveway, keys were on the side bench, car was in good condition, is it not fair for someone in your scenario above to assume it was registered?
I feel borrowing someones car in your scenario above and finding out it is unregistered later you should not be able to be fined as it is reasonable to assume that car was registered.