Respect and trust for friends is something I hold in utmost regard. I've been "the other guy" in that kind of situation and never done anything.
Case in point at a New Years' party a few years ago, a good friend of mine was there with his then long-time girlfriend. At some point in the evening, I had her sitting on my lap for a good length of time with my arm around her, giving me hickeys and taking turns to lick eachother's eyeballs (don't ask). Things were getting VERY close, and he was sitting in the same room the whole time, but I stopped it there.
Stepping outside for a cigarette, I had another friend whose home it was lecturing me that I was "so in there" and should be "******* going for it", but there was absolutely no way in hell I was doing so. I'd had a lot of drink in me (which also bolsters my belief that "I was drunk" is absolutely NO excuse in cases of partners cheating) but I could still tell right from wrong. To this day, I still haven't apologised to him for my behaviour that evening - but I fully intend to.