It is very likely that the first time he applied for the lottery he would lose his visa and have to leave the US for an indeterminate period of time. The way it works in practice, people that had another visa before are at a disadvantage in the lottery. It is also not free.
Military service was potentially another route though, but may have been intractable due to circumstances like student loans or military fitness requirements relating to a disability or some such.
No. There is no connection between the lottery and your visa except if you win. You do not win the green card, you win the application. Not sure why you thinking that the lottery is not free, but it has been free forever (except for the scam sites).
Military service only gives you green card and residency if it is war time. During non war time, it allows you to apply for citizenship after you served (instead of waiting 5 years), but you need a greencard before that.
With only two exceptions (Philippines and American Samoa), you need to be a permanent resident (i.e, already have a green card) to enlist in the U.S. military if you aren't a citizen.
Military service was potentially another route though, but may have been intractable due to circumstances like student loans or military fitness requirements relating to a disability or some such.