Your friend is very fortunate to have such a caring friend. The simple answer to your question is “no”. It’s not healthy for someone to isolate themselves and to confine their relationships to those on line.
The issue, in his case, is not how he should get his schooling. The most important issue is how he is going to find people he can get to know up close and personal. He will only develop the social skills and network of supportive friends everyone needs to be successful in life by being around people and working at making and maintaining friendships.
I don’t know what discouraged him so much that he is withdrawing from life. I do know that he needs to find some way to get back into it. A therapist would certainly be helpful. In addition, volunteering at a cause he believes in, joining a club or organization that interests him or taking classes at a community college or at a town recreation department are ways to find people who are like-minded and who share his interests. Do encourage him to explore opportunities like these.
I wish you well.