I went to my Grandfather's funeral when I was ten. I wasn't there when he died, and had never had anybody close to me die. I didn't know what to do, how to act, how to feel, and nobody would tell me. It was miserable.
I remember at one point, people got up to talk about him and such, and having no idea how these things worked, I was terrified somebody was going to call on me to go up and speak. I ran out of the room and hid under a table out in the hall, which got me in plenty of trouble. It was an awful experience.
I'm telling this story to make the point, that children have no idea how to handle these things, unless we teach them. As a parent myself now, I forget sometimes that kids don't know stuff. They don't have the benefit of our life experience. I sometimes look at my kids and think "why in the world would you do that, or think it's ok?". The answer is because they've never been in that situation before, and haven't been taught by me how to handle it.
I've never shied away from death with them. I've never forced them to sit through it either. My oldest is twelve now. I think he's definitely old enough to deal with it, but I would not force him if he didn't want to. What I would do, is make sure my kids got to say their goodbyes. They would want that. They wouldn't have to say the actual words, but I would definitely make sure if their Grandmother were dying, that they went to see her one last time and spent some time with her, saids their "I love yous" etc. Without that closure for a kid, it feels too much like somebody they loved just kind of disappeared.