I dealt with much of this when my dad died, and then again when my mom died. But by the time my dad died, it was already all in an IRA, after rolling over the 401K he had upon his retirement.
I am not a lawyer, but in the case of my dad's passing, my mom simply inherited his IRA as her own, no tax issues involved. When my mom passed, that IRA was broken into four equal pieces for her kids, and while we could inherit the IRA, since she was already over 70 1/2 and taking RMDs from it we also have to take RMDs from our portion of the inherited IRA based on our own life expectancy.
But in reality, a spouse should be able to inherit a 401K like an IRA. Whether they should roll it over into an IRA is a similar decision as to whether someone should roll over their own 401K into an IRA. There are considerations including flexibility in terms of withdrawals and asset protection. (A 401K is a pension plan by law, so it is protected by federal pension laws whereas an IRA's protection varies by state.)