Luckily I haven't had to deal with lice in a few years now, but when I lived in Southern California, you had to be vigilant about prevention. My son only got it once, same situation you described, a "friend" asked me to watch her kids for a weekend, and "forgot" to tell me they had lice.
When my daughter got older, she picked it up from school a couple times. The best product I have found is Nix, the creme rinse, but no matter what you use, you have to be sure to get all the nits out of the hair and wash all sheets and pillows, and put all stuffed animals in a plastic bag for at least two weeks. A real time consuming pain in the a$$!
I seem to remember that there was a product, in a spray bottle, that claimed to repel the little buggers to prevent infestation. I used it on my daughter, and it seemed to work. Don't know if it was coincidence or not though. I also checked her hair daily so if she got anything from school I could catch it early.
In my opinion, one of the biggest problems at that time, was that my daughters school did not have a "no nit" policy. The children who got lice were allowed to return to school if the parents showed that they treated the child by bringing in the empty bottle of Rid or what ever they used. But as with your friend, not all the parents treated the childs bedding or removed all the nits, and they would become reinfested and continue spreading it to others. You might want to check with the school or daycare to see if they check the children before they are allowed back.
Sorry this post is so long, but it really strikes a chord with me. I spent so much money and so much time battling these things, and it was very frustrating.