Switzerland is F**king expensive, crap hostel = $40, a slightly less piece of shit hostel can be had in Zermatt or Interlaken. Italy is the cheapest in that neck of the woods but France has the best terrain. Verbier is the big daddy, if they are serious tell them to go there. Bourg St Maurice or Brides Les Bains is a good place to stay in for short stints. Interlaken and Engleberg are supposed to be cool and smaller. I would guess from your post they aren't the hardest of schraplers, in that case they should just go local. Switzerland has an amazing hut system, if they can do it they should check it out as it would be an unbelievable experience.
1. Take trains
2. Be careful, Euroland isn't NA and they don't do the trail thing well, additionally they will be rude in line by NA standards and drop the damn bar on your head. They panic and for some reason feel the need to slam the bar down 1/4 of a second out of the gate. They will smoke everywhere.
3. Stay away from the Bunker...DO NOT SLEEP THERE.
4. Go see Zermatt and the Matterhorn
5. Hike to
http://www.zermatt.ch/trift/ drink tea and enjoy
6. Good ole pot is sold in stores as a potpourri, I don't know about the specific legalities but no one cares.
7. Consider a guide.....riding will be alot different with alot more challenges, life will be much simpler with a guide.