I've been to a few funerals where the younger women present, in their late teens or early twenties, were wearing what I would consider 'party' dresses, sometimes even 'clubbing' dresses - shiny fabric in various colours, strappy or occasionally strapless, high hemlines. I don't think any disrespect was intended in the least - they were wearing their 'best dresses', the ones they would also probably wear to a wedding, but it did look a bit inappropriate. (These were definitely not the kind of funeral where the deceased has requested a celebration rather than a memorial.)
On the other hand, when my mother passed away in 2009 I had to go out and buy appropriate clothes for the funeral, and although it would have been absolutely appropriate for me to wear all black, somehow it didn't feel right. Almost over-dramatic, if you know what I mean. In the end I settled for a black jacket and shoes, and a darkish grey dress, of the kind you might wear to the office. That felt just about right to me. And my MIL and FIL turned up in normal day clothes, but it was way more important to me that they had driven nearly 5 hours to attend.