Unfortunately, this style definition seems to be exposing some bug in the LJ server software. A large fraction of the time, the post returned is not the latest one -- I regularly see it return posts that are over a week old. I've been trying this out for over a month now, and I'd say at least 1/3 of the time it returns an incorrect post.
As an experiment, I just modified the style to return the latest two friend posts. Now I seem to get the genuinely latest post first, followed by a bogus post. You can see an example here (view source to see the XML; and of course you can replace 'snej' in the URL with your own username to have it show your own friends' posts.) At the moment, this returns my latest friend post from about a half hour ago, followed by one from July 22nd. (Before I increased the number of posts from 1 to 2, the 7/22 post was the only one I got.)
Of course, this problem is intermittent, so your results may vary. But someone knowledgeable about the server software [i.e. not me] might want to look into this bug...
