Unlike many other large events in a person's life, a death can tend to bring up an odd kind of question. This doesn't have anything to do with inheritance or who was the deceased favorite relative. All of that is not a part of this question and, unless the decision is made beforehand, there could be a whole lot of arguements on the whole thing.
The question is... What kind of service to hold - funeral, memorial, or wake?
While two of these choices could seem like they are very similar, there are also subtle factors that bring out the differences. A funeral is the full blown church service with all of the accessories including the dearly departed in most respects. The finale of this kind of event tends to lead to going out to the graveyard for the standard rememberance as the coffin is lowered into the grave. It tends to work into a very regimental kind of way and it all tends to work the same way every time.
The memorial service is an odd kind of ceremony that actually sort of fits right in the middle of the others. You get all of the standard somber rememberances and the the like but you also get a couple swerves thrown in for good measure. A memorial service tends to play a little fast and loose with the musical choices which allows for freedom to be creative. I'll always remember watching parts of Jim Henson's service on the news because he had New Orleans style jazz band play "When The Saints Come Marching In" to close the whole thing. You just don't get something like that at your full funerals.
Another part of the memorial service that leans closer to a wake is the idea of the assembled friends and family being allowed to give voice to their feelings of the departed. Instead of just sitting for the whole ceremony and listening to the priest give the eulogy, there is a time set aside if any of the people in the pews want to say anything. This freedom of language gives everyone the ability to voice their thoughts and feelings and also helps to work as kind of an emotional release. Instead of holding in all of that emotion and interesting stories, they are shared with everyone in the room and give a fuller vision of the person that you are there to be remembering.
The third choice tends to be the favorite of alchoholics everywhere, namely the wake. The least formal of the three services, this one tends to go in all kinds of directions due to the probability of a large amount of alchohol being consumed. It's not a requirement of a wake for everyone to get blitzed but it just seems to work out that way most of the time. Along with the alchohol, the event is made up of a group of people spending the time telling stories about and listening to the favorite music of the departed person. It is also the most informal of the three affairs so it has a more relaxed sense of self. You don't have to be dressed up or quiet and respectful at a wake which can help to loosen people up in this time of emotional stress.
If I was asked my choice, I would go to the memorial service though a wake would be cool too. The only problem with the wake is that I wouldn't be there to enjoy the drink and talk. It kinds of puts a very morbid air on the whole endevor since it reads like your trying to come up with a party for a group of people that might not want to be there. As long as it's not stuffy and formal the whole time, it could be a very cathartic kind of experience for everyone concerned.
Everyone except the person that died... though that would tend to be a little obvious once you think about it...