Using your parents funds. Any advice?

This is something you probably should have known.

Coming out after FIL has passed, with basically no money left, just is what it is. what does his will state? Probably that son and family will get everything.

The pension/SS funds should stop at death. That isn't OK, but honestly, I probably wouldn't fight this battle.

If they were using FIL's funds while he was alive, living in the house then the pension and savings are / were being used properly.
Even if FIL was in the hospital or in a facility the pension and other assets were being used to maintain a house that FIL may have returned to.
IF they used his assets AFTER FIL died then that is not appropriate. (It would not be "elder financial abuse" though)
Once FIL died then whoever is taking care of the estate should inform the son and anyone else living in the house that the would be responsible for any bills. The person taking care of the estate would inform all utilities that the person has died and final payment would be made and if the son and grandkids are to remain in the house utilities would be put in their name.
If someone is inheriting the house utilities could be put in their name and if it is different than the son the person that now owns the house needs to either work out a rental agreement or start eviction.

Sure. Your FIL had the help and support and love of his son and grandkids to say nothing of the companionship of family. The home was your FIL's home. The bills of the home were his to pay. I am 81 this year, and there's honestly not a whole lot of places I want to "go" nor do I drink or smoke, or even eat as much as once I did. That's just a part of aging.

I would say that this mutual agreement worked out well for both parties. And Dad died having used up all his funds, but not penniless. It sounds like lucky circumstances to ME. It sounds IDEAL to me, but then I am assuming this was their agreement, and they took joy from having one another in their lives.

Sure they can if that was the arrangement.

If your FIL needed any help because of illness or Dementia I would agree that the son needed to use Dads money to pay bills. If FIL was competent then he was aware of what was going on. If FIL lived alone, he would have been paying the bills. Like said, not much you can do about it now. Hopefully there is a Will and the house was left to all his kids. The house may need to be sold and proceeds divided up. Then BIL will have to find his own way.

Maybe it was their payment arrangement for the care and effort they put into helping your FIL? I wouldn't jump to any conclusions, especially since he has already passed. Did he leave a valid Will? If so, is there an Executor? Has his estate gone into probate yet? Sounds like his house is is the only asset left... his SS and pension came to an end when he passed. Most likely the house/property will need to be probated, but it depends on what state it is in.

Is there any reason to believe that your FIL was incompetent or that your BIL was abusive?

Did your FIL live in his house too? How confident is your spouse in their assessment of their father’s cognitive abilities and care needs?

Many elders want to age in place and it is not unusual for them to spend down their assets in order to do so. It is also not uncommon for an adult child to move in and offer companionship and assistance with driving, etc. in lieu of rent.

Apparently, they did, so yes they can.

Likely water under the bridge since he is deceased.