Sadly, I've been in this situation on several occasions. I honestly don't think I would tell the friend, but I may talk to the person who is cheating. For the most part, though, I believe it is up to the people in the relationship to deal with their relationship. This may seem harsh, but I've been burned before by meddling and getting in the middle of things.
No, but a friendship was lost because I did say something, and another was badly hurt because of a confrontation I had with the cheater.
No. Cheating is a hard issue. I can't say I'd never cheat, I don't think any of us knows what we're capable of until we're knee-deep in it, but if I were to ever cheat on someone I was with I would be devastated and finding that they were also cheating would only make the devastation worse. I wouldn't feel justified.
Yes, I've had a few friends who have cheated on their significant others. I always advise against it but I try not to get into other peoples business and I try my best not to judge them, but it's been very hard when I've seen people close to me get hurt.
My sister cheated on her husband many years ago and when it all came to a head I saw first hand what something like that could do to someone. I've also had close friends cheat or be cheated on and it's never pretty, but it's also not usually any of my business.
Personally, if someone knew my boyfriend was cheating on me, I'd want to know, but I don't know that I'd want to hear it from them... I remember hearing after my ex and I split that my sister's friend saw him shopping with another woman while we were still together and thought something was up but didn't tell me. If they had told me, I don't know that I would have believed them, and I think the end result would have been the same.