You are right and your friends were wrong. To your friends: Guess what. Being nice is not a substitute for paying someone fairly. You are required to tip properly AND be nice.

Considering the unusual circumstances -- taking a lunch spot at a prime time for the server to earn -- you did the right thing to bump up the tip over the suggested 15 or 20 % standard amount. I do the same thing. With drinks, I may even pay as each round comes out, making sure to include a healthy tip right away, so the server will know that they're taken care of. But the way you did it is fine.