Since you have known her for a very long time, putting all moral arguments and 'what if things go wrong' aside,
Let's say you help her have a child. She brings up the child as her own. However the child is sure at some point to ask questions. Who is my father. How will she reply?
Your being a friend means that you will still be involved in her life, even after the child is born. Being human, and child being yours, you will play a father role in your child's life, unless you have no human emotions whatsoever and don't care about the woman or the child, which will likely not be the case.
You are married and have a wife. You obviously cannot tell your wife and you have to be prepared for the consequences if your wife finds out. At the very least it is an affair, even if one time only and a betrayal which your wife will have to deal with if at some point it becomes known. Divorce is possible, depends on your wife's character.
I can understand the woman being desperate and lonely to have a child that she asks someone to help her. If she gets from a sperm bank, she is on her own and it is difficult for a single parent to raise a child, financially, emotionally. If you become the sperm donor, she knows you, your character, and you will be involved one way or another in helping her with her child, even if not financially, then as a very special uncle who often comes to see her and his son. Unless she intends to break all contact with you after she conceives which I think is highly unlikely unless it changes the relationship between you both or your wife finds out and issues an ultimatum. Bear in mind your wife will be heartbroken if she finds out and may do something drastic, just like the guy who got an organ donation from his wife's lover.
I don't have a yes or no answer, if I have a close male friend I may ask him myself but a married guy has a lot to consider and risk. I believe guys too have affairs on the side if their wives cannot conceive. It depends on the people and their moral decision.
Hard to say no, yes? Especially to a trusted old friend. But what she is asking of you is a lot and while your heart may break if you say no, I think she will understand and expect it (60%) if you say no, especially since you are married. Sometimes women just ask because the loneliness is much hard to bear and in a moment of decision they just give it a try. But if you do go ahead, be prepared to play a part in your child's life and be prepared for all the complications that may arise above.