Friction is on both sides of the equation when using mass to determine terminal velocity, so it cancels out. Think of it this way: The thinner atmosphere does enable a higher terminal velocity, but it also reduces the total friction in the system, so less heat is generated.
This relationship is linear. However, mass of the planet vs. mass of the individual does effect the equation, because these values are exponential.
But I'm not really interested in getting into a physics battle, I'm much more interested in the flavor info.