I think we have to assume that the picture didn't violate the wishes of the deceased. The person who's mother was in the picture would know more about her wishes than any of us would. That's not what this thread is about. If this were an issue of not respecting postmortem wishes and/or not considering what the deceased would have or would not have been ok with during life, it would be an entirely different conversation.
My basic problem with the assertion that this picture is not ok is that it seems that some are saying "This picture is disturbing to me, therefore it is universally disturbing, and blanketly wrong to post it on FB." Yet, there are whole cultures of people who take these pictures regularly. (Even if you don't know them and that's not the case in your circle.)
I think the biggest differential here is how people view FB. While I don't necessarily agree that FB has an etiquette standard all it's own, I don't liken it to being out in public. If we have to make an analogy between it and real life, I would say FB is like your home. And I believe that in our homes we have a lot more freedom of what we choose to hang on the walls, etc, than say a public building or our work office. We have greater freedoms of what we discuss at home than maybe what we would discuss at work. We also choose who to invite into our homes and those we invite choose whether or not to accept the invitation and whether or not to ever come back. There is a wide variety of what people consider appropriate and not inside their own homes, even on this board, but it doesn't make any one of them wrong. What is wrong is telling someone else what they can/can't display in their homes.
I wouldn't invite someone to my house and then insult them personally...just like I wouldn't purposely insult one of my FB friends on FB. But, I will speak to and display my religious beliefs freely regardless of what others say and if I were the type of person to take pictures of open caskests (and I'm not), then I would do that in my home as I see fit.
What FB isn't like, is going out in public, grabbing someone by the arm and forcing them to look at pictures after they expressly said they didn't want to. When you (general) choose to use FB, you are basically accepting a peek into someone's personal life...and what part of their personal life they choose to share with you also varies widely. But, you do so taking the risk that you may see something you don't like. It's part of life. Etiquette guides us into attempting to be considerate of others and it also guides our own behavior when we are faced with less than pleasant things. But, IMO, etiquette does not set up a black and white list of what people should and should not be bothered by, nor does it protect you (again general) from never being offended or disturbed.
ETA: I want to clarify that I do not think it was innappropriate or wrong of anyone to post about the Newtown school shootings. That's my point. Even though that event disturbed me more than anything else that didn't directly affect me, and disturbed pretty much everyone I know, I still don't think it was inappropriate for people to choose to post pictures, stories. or opinions about it on FB.