I actually had a friend who wanted his ashes scattered in a specific place (not Haunted Mansion) at WDW, and his family did do it. (mid 1990's) I had no idea it was popular, though.

They spread them at a rare spot of actual dirt and grass (and not all of his remains). I don't think it's any different than spreading them in his favorite meadow. It's a place where he was happy, and they have happy memories of him there.