Like addiea raine said, a lot of funeral homes will do cheap or free loaf funerals. Many will do kid funerals for free up to a certain age (like 2-3 years old). Soooo I'd love to know what these high estimated funeral expenses are going to be because even if a loaf funeral had all the same billed expenses as an adult one, everything would still be cheaper than an adult funeral because everything would be much smaller for a loaf service. Smaller casket/urn, less materials used for preparation (if they want an open-casket service), smaller grave and grave marker if it were to be buried.
If I had to guess, the truth is probably closer to this:
"Hey everybody, so our kid died and you should feel bad for us! We'll totally get a funeral for free, but in order to help us during our time of mourning, you should give us money so we can make ourselves feel better with a brand new TV, a swimming pool, a new car or a vacation or two so we can attempt to fill the void our dearly-departed angel has left in our hearts."Even if they couldn't afford a funeral that wasn't free, unless they visited a completely sleazy parlor, I think a decent funeral director would help them have as affordable and dignified of a service as possible. These people didn't get the luxury of having a long-term attention sponge because it died too soon, so they want to milk the short-term sympathy for all its worth. Besides, I seriously doubt both parents are completely alienated from all family and friends, so why aren't their relatives helping pay for the funeral? Even if the family hates the parents' guts, I imagine they would never hold that hatred against a kid who didn't ask to be born and would want to give it proper after-death care.
Not a cent of that money is going toward a funeral. It's all for Mommy and Daddy to buy some big, expensive toys for themselves.