How to not look like a big jerk

I'm having a tough time understanding something....
How can FG not look like a big giant selfish asshole when someone wants him to do free work?  He has a business doing what he does and he makes a living at it.  Granted things aren't as "fat" as they have been due to our wonderful economy.  I think if we hadn't been hit so hard a few years ago and were not working so diligently to now pay for being hit hard, things would actually be a lot better on the financial front.  Damn Karma - we are hoping to be on the good side of it by actually paying off debt and not creating more.
Anyway, he deals with some people wanting him to do what he does "as a favor" quite a bit.  Then when he says no and tells them what such a project will cost for his services he looks like a big giant greedy asshole!  I don't get it!  When he has SMA do some stuff for him that SMA makes a living doing, FG pays him.  His best friend and yes FG pays his best friend for his work.  So why do other people think that FG should just do these quick "favors"?  1) they are not quick 2) he charges other clients for the same work 3) he's giving a discounted rate because they are already clients. 

I fall on the sword for FG with this client often.  I tell said client no and we will not do XYZ until we are paid etc. etc.  It sort of makes FG look completely whipped by me as his wife but I always preface things with I am his business partner and I am speaking AS his business partner.  I look like a greedy bitch but really?!  Is it really too much to ask to be paid for our work?!  Shouldn't FG be paid for what it says he does on his business card? 

I'm wondering when this client will get this.  A year of asking for free work and waiting forever to pay FG for the work he does pay him for and he still doesn't get it when we keep saying NO to doing the extra crap for free.  FG told him no today, thank goodness.  The client wasn't happy but too damn bad.  Go find someone else who will do the same quality of work in the same amount of time at the same rate.  Not going to happen.

Those of you in business for yourself... how do you handle it or do you even get asked such incredulous things like we do?