Cheating is cheating, there's no rationalization for it. Regardless of whether or not there's an honor code, or it affects you, or you're friends with them - the honorable thing to do is report it. No one wants to be the one who told and get involved if they can avoid it, however, to maintain the value of your work and work done at your institution, cheaters need to be stopped...otherwise you end up like South Korea, where all of their work is questioned due to the bad decisions of a few.
If they fail, they fail...maybe they needed to work harder or get a tutor, but that doesn't make it ok for them to cheat. Ask the professor for what his rules are for taking the test outside of class. Tell him that some of the students were planning on working together. As it hasn't happened yet, a stern email from the Prof. may prevent them, otherwise at least he'll be on the lookout for cheaters. Finally, most professors have a damn good idea of what grade you're going to get on the final, it vary rarely deviates from the rest of the semester, and I imagine that they would examine any dramatic improvements on a take home exam with a bit of skepticism.