Should the aqiqah be cooked and distributed, or should friends be invited to it?

There is no difference in feeding the 'aqiqah (sacrificial animal for a newborn) between raw and cooked meat; both are permissible. The 'aqiqah is like the udhiyah (sacrificial animal for Eid al-Adha), and the udhiyah is like the hady (animal sacrifice during Hajj). Allah the Almighty said regarding the hady: "Then eat thereof and feed the distressed and the poor," (Quran 22:28). This includes feeding it raw or cooked.