I suppose the ultimate question about a state funeral is: would a decent proportion of the country find this objectionable?
Ultimately, for such an event to be given that status, then it is right that its existence is widely received in at least a lukewarm manner.
In spite of his fairly aristocratic background and occasionally reactionary views on foreigners, I do not imagine that many left leaning UK citizens opposed Churchill's funeral being afforded such status.
On that basis I think it would be wrong to give Thatcher a state funeral. I think she did a lot of difficult and necessary things, especially in her first two terms, but that is hardly the point - that is what she was elected to do.
The point, in actual fact, is that a state funeral should be for someone who brings the nation together, and I doubt anyone would argue that was a legacy, that applied in any meaningful way, to Margaret Hilda Thatcher.