I'd be a bit upset, regardless of the quality of the other picture. If I put a lot of time and effort into the picture I'd be upset about the time wasted. I tend to be the sort that gets sad when offended rather than angry.
I'm guessing something similar happened to you? My friends and I tend to be very honest with one another, so if I was to confront them they would not get angry, I don't know how your friend might react. I would suggest staying calm and talking to your friend about it. Try not to get angry. Your friend may not have thought it was a big deal, they might have liked the other image better (even if you disagree, sometimes people disagree on these things), they might have thought you weren't working on it, or they might have been concerned about offending the other artist (after all it's easier to get our friends to forgive us than strangers).

I'm sure your friend didn't mean to upset you. So if I were in your shoes I'd talk to them and explain that I was upset and why, and I'd try to understand why they chose the other artist's work over mine. Hopefully it would help prevent similar problems cropping up in the future.