I agree, it's a horrible, horrible idea. Is this guy planning to get the entire litter spayed and neutered? What if it's a litter of 14 puppies? I would simply, flat out refuse to be a party to it, but if he doesn't use your male, he'll probably be able to find another.
A pack of untrained farmdog littermates running wild on a ranch is just about the worst idea I can think of.