on being friends with a pedophile that actively downloads real child porn
Hell, I'll go further than most, and say that I would continue to be friends with him even if he had actually done something provided that all of the following conditions were met: He was caught and convicted, he was punished, he complied with all of the elements of legal supervision (parole, registration as a sex offender, etc.), he admits what he did, he feels bad about it, it happened no more than once, he was under 22 when it happened, it has been at least 10 years since it happened, and all the other conditions of the OP are met.
I believe in judging people as they are now. It would take a lot of convincing for me to believe that all of those conditions were met (and of course things like his age and the length of time are not bright lines), but if he is really as good a friend as described, I think it would be possible.
I will add the following caveats: I have no kids. If I did, I think I'd still be friends under the OP's conditions, but very likely not if he'd actually done anything. I'm sure I'd agonize over it no matter what. And finally, I'm not sure this makes me a better person. My natural tendency is to react to people based on what I actually see, not on what else I know about them. It's easy to make this into a virtue, but it could just as much be moral laziness. Along with this is the fact that I don't tend to form extremely close friendships, so what I'm picturing as a continued friendship may be just an aquaintenceship to someone else.
Oh, and regarding the legal aspect, I voted that he would be convicted and it would stand (assuming he was convicted of obscenity, not child pornography), but actually, I believe that most people in that situation would plead guilty and not appeal it only to get the whole ordeal over with. (A decision they would possibly regret, but nevertheless what they would do. Fighting a legal battle is very expensive and extremely stressful and this story would undoubtedly be in the press a great deal while it was ongoing in court.)