I tend to agree with your friend who said this. I am always amazed by so called " good breeding sires" that never sire a son that is as good as, or breeds as good as their sire. If we are properly breeding cattle, we should be breeding for improvement in each generation. That said, this is not as easy as it sounds and what is good in one decade is not the same as what is good in another. For this reason, I do think there are some sires from the past who can offer improvement today. The qualities they had when they were alive were not recognized in that time, and I know of many excellent bulls that were long dead before they received any appreciation for what they offered the beef industry. One of the biggest issues I have with people who are searching for old genetics, is that they " assume" if the semen is old, it must be good. There are lots and lots of bulls from the past who were not good then .... and they are not good now. There are a few others that offer some traits that we certainly can use today. I have used some old genetics especially in my ET program but I have tried to be very careful to use these sires on the females that I think they will work the best with. I have a pretty decent bull calf in my bull pen right now, that is sired by a bull born in 1966. This calf had the lowest BW in the 2013 calf crop at 68 lbs and he has developed very well. He may have some traits that will prove to be worthwhile.
In a perfect breeding situation I believe a great breeding sire should have sons to take his place in a very few years. Hopefully they will breed better or at least as good as the sire did. Unfortunately, this doesn't happen as often as one would think.