Interesting but practical dilemma.
Who claims Sam wanted a lavish funeral? By lavish, do you mean horse drawn carriage and a choir? Were there detailed plans drawn up by Sam?
Or do you simply mean he didn't want to be cremated and put into a carboard box and scattered over a muddy puddle?
Why does Sam have so many friends?
Or is there a large crowd of sadistic people lurking in your neighbourhood?
How do you know the veracity of Bob? Were you there to witness the glee with which Sam told Bob he was written out of the will?
What happened to Bob's mum? Is she dead? Because you'd think she and/or her maternal family would have more of an influence.
For whatever reason, how do you know Bob was not a trouble-making child, causing major disruption?
Does Bob have siblings?
How do you know what abuse and neglect Bob endured? Taken into care might also be for other criminal reasons. Damaged people can also be damaging.
And was Bob really cut out of the will?
I have to say if he wasn't, and if he'll feel better by getting his hands on every last penny, he should go for it. Dad is dead and can't care anymore.
If it's just an ethical problem, then just cremate dad, hand him over to friends and hold a small wake - none of which Bob has to attend.
Because seriously, whatever is spent on the funeral, was dad's money. Just bury or let his friends scatter him, and move on.