Hello, Honeypuck,
We went through something similar when our daughter lost a close friend, although she was only four and his death was very sudden.
All you can do is be there, listen and be honest with any questions that you are asked.
Re the funeral, I didn't take dd1 because I was 7 mo pg and beside myself with grief, and I think it was a good call, but now she's older I think I would take her even if she had to deal with a very upset mummy.
Re fundraising, dd1 has spent a year running a stall at our local village market which is once a month. She's done things like grow plants, make fairy wishing stones and decorated gift bags, and we also bought in some Christmas decs which went down really well. She did this two-three years' after her friend had died, and I cleared it with his mum first. She's told me that she's pleased that one of her son's friends remembers him. (obviously they were very little when he died).
In the meantime, there is no reason why your dd can't do something private. You could maybe plant a tree or bush in your garden, or blow some bubbles to take dd's wishes and love to her friend, just do it privately at home. You don't need to tell anyone. Does dd have a photo of him? Our friends gave dd1 a picture of her friend which she has framed in her room.
Our friends did start fundraising fairly quickly after their son died. Something that our dc's school does is every year the top class (yrs 5/6) organises a Summer Fair for a chosen charity towards the end of term, it happens in school time and all the pupils have the afternoon off to go as well as parents and people from outside the school. Maybe that is something you could think about for when the time is right?
for everyone here who's lost a child.