 Solution

No. Assign the two free generators to $(1,0)$ and $(0,1)$ in the lexicographically ordered group ${\mathbb{Z}}^2$. The universal property gives a lattice-ordered group homomorphism onto this group: its image contains both ordinary group generators. It is not an Archimedean ordered group, sinceThus a lattice-homomorphic image can contain a nonzero positive infinitesimal even when the original free object has an Archimedean pointwise function representation.