Ferrio said:
My friend told me he was saying "daiyo" not "baiyo"
Actually, IIRC, I said he was saying "bayo"
in place of "dayo". It's just a manufactured dialect (or speech impediment, depending on your point of view). On a related note, you may know that in Kansai-ben you will see the copula "da" replaced by "ya" (souya for souda, etc.) I have read that some Japanese authors, when trying to show that dialogue is being spoken by a character from Kansai, will merely replace every occurance of "da" with "ya". This is about as unsophisticated as replacing "you" and "your" with "thou" and "thy" to imitate Middle English, but that's basically what they are doing.
Also, MegatronM, "-ttebayo" is most certainly not Naruto's way of saying "desu". Read fenneku's explanation; it is spot on.