If he's Iaido, his teacher may not do any cutting whatsoever.
So, I'll pass on what little I know just in the name of keeping medical bills low.
KEEP EVERYONE BACK! Twenty feet should do it, provided you follow rule number two.
Do not keep anyone behind you while doing the cut. You are most likely to lose the sword at the end when you stop, not the beginning when you start. Directly behind the swordsman is the most dangerous location there is.
Stay clear of your leg. You were probably taught this in Iaido, but it is generally a bad idea to perform a cut such that if you don't stop the blade at a certain point, you will cut your leg off.
Anyway, there are a number of reputable places to buy swords. If you insist on persisting with this, the general suggestions are
www.Bugei.com and
www.Swordstore.com. Also, Angelsword has some pieces which are very good for cutting, but are highly non-traditional. Good luck, and be careful my friend.