My friend would like to make a chocolate cake using this recipe: HERSHEY'S "PERFECTLY CHOCOLATE" Chocolate Cake
They'd like to use baker's chocolate squares in place of the powdered cocoa.
Is this possible?
It's just a really basic (plain-vanilla, if you will ;) chocolate cake recipe. You'd be better off just finding a basic chocolate cake recipe that calls for unsweetened chocolate in the first place, especially if you're new-ish to chocolate cake.
Otherwise the substitution that Sobachatina suggests above requires some fancy recipe-adjusting work on your part. Cocoa & fat (melted butter, usually) can be substituted for whole chocolate, but it's not really such an exact science, so I don't think the reverse substitution will give you the results you're looking for.
Baker's chocolate is essentially cocoa powder and cocoa butter. Usually a little lecithin is added to make it smooth and sometimes it has some sugar.
This means that one cup of melted baker's chocolate could be used in place of the 3/4 cup of cocoa and 1/4 cup of the fat in the cake recipe. Obviously it would have to be added with the wet ingredients instead of the dry as the cocoa is.
If the baker's chocolate is bittersweet or semisweet instead of unsweetened then the sugar in the cake would need to be reduced accordingly.
The lecithin in the baking chocolate will actually improve the consistency of the cake.