They wouldn't extend that visa for him at that time. I think that was a really extreme interpretation of the regulations, and those are things that pass between family and friends all the time for affection and helpfulness with no thought of there being toil or obligation, so he was unfortunate, but having put in writing what he'd been doing and wanted to do more of, he was stuck.
This from the INZ operational manual.
http://www.immigration.govt.nz/opsmanual/
V2.1.1 Definition of 'lawful purpose' for visitors
For the purposes of applying the 'lawful purpose' test in the provision relating to bona fide applicants (see E5.1), visitors are considered to be coming to New Zealand for a lawful purpose if:
...
they are not intending to undertake employment (see W2.2.1)
W2.2.1 Definition of ‘work’
Work means any activity undertaken for gain or reward...
'Gain or reward' includes any payment or benefit that can be valued in terms of money, such as board and lodging, goods (e.g. food or clothing) and services (e.g. transport).