Personally, it doesn't bother me all that much. The dead body images published by newspapers are almost invariably in very public places (except for maybe the Michael Jackson ones), so I don't see how it's more 'disrespectful' for me to see it than for any of the people directly around it to see it. Plus on a more general level I'm slightly uncomfortable with the very sanitised way in which people imagine death - death is messy, undignified, and inevitable. I'm not sure how healthy it is to imagine death as a quiet, clean little process that we don't have to think about if we avert our eyes.
Having said that, principled opposition to our stances on death is most certainly not the reason papers publish photos - they publish them for the same reason hucksters use to put on freakshows: because people like to gape. Personally, I'm fairly indifferent to that as well. But a lot of the newspaper readership in this country do seem to find newspapers aiming to indulge that feeling unpleasant, so it makes sense for papers to avoid doing it.