The windows face the same way
The windows in the Boy's & the Girl's apartments are oriented the same way. The doors to both apartments are opposite each other, no corners or bends are present to change the orientation.
As you enter Chandler and Joey's apartment the window is on your right, as you enter Monica and Rachel's it is on the left.
This means they are on the same side of the building.
Made by fans after apparently watching hours of episodes as detailed here, shows this better than my description. I know this is dubious canonicity, but it is here merely as a visual representation of what I am describing.
There are bulgy parts that would block her view.
These bulges do not match with the exterior shots of the apartment building (Note: there are no balconies either):
Therefore this looks like either
- Joey is lying, maybe making a joke, or just saying something "Off the cuff" without thinking about if it actually happened, a fairly typical "Joey Comment".
- Its a plot hole where the writers haven't taken into account the apparent strange shape of the building on the inside.
I'm opting for number 2 due to the picture of the outside not matching either, I don't think the writers have paid much attention to the layout of the apartments.