The psychology around this will vary from person to person. It's impossible to be 100% empathetic and imagine what other people would like to remember deceased loved ones by.
Some will find it distasteful, and others will find it beautiful. Opinion in this matter are almost irrelevant, and will not really help those who appreciate having post mortem portraits of someone.
I think it's remarkable that there are those who offer services to provide it, and as difficult as it may be, it can turn into something of tremendous value down the road. That's true for many photographs, and we may not think much of it at the time of taking the pictures, but we do, and with time many of them become valuable even though we may not have expected them to.
I took pictures of all my living grandparents when I went to visit my home country in 2010. My maternal grandmother was still in her apartment with assisted living, clear as a bell, full of fun, and I got a magical moment with her. The next time I visited she had deteriorated very rapidly, living in an elder care facility, and while she was in good hands it wasn't the same anymore.
Same thing with my paternal grandparents. Grandpa was strong as an ox still, chopping wood and running the household at age 85. Now he's got diabetes and bladder cancer, and is looking much weaker at age 88, and the strong man I remember isn't there anymore. I got a portrait of him too that shows him at his best, in his beloved back yard. Grandma has sclerosis and her back is so crooked that she can't sit upright anymore, so at age 83 I got a lovely portrait of her, and today it would be impossible, only three years later.
At the time of taking the pictures, and showing them to other relatives, I didn't get much reaction. But today I get requests for reprints since one of them passed away and the other two are crippled with health issues.
These examples show, very rapidly, how time alters the value of our photographs. It really bears thinking about, and taking into consideration, when we comment how distasteful something is, regarding something that can be of tremendous value to others. Time value of photographs is real, and may be the only thing somebody has to hold on to a beautiful memory.