At the moment, though, Dwarves appear to have no flint-like fire-starting kit[1]. It'd need to be a built workshop-like place (crematorium?) which could be magma or non-magma powered (the latter needs (additional?) fuel, and the initial flame comes from wherever it comes from in other circumstances).
One thought I had, when I was opening this thread is that the spirits of Dwarves really should prefer to be either entombed (coffins/sarcophagi) or memorialised in stone, and that they probably wouldn't recognise being "sent up to heaven in a great big puff of smoke" as being a suitable funereal ritual to sate their souls and prevent their ghostly selves wreaking havoc. When I saw that it was about goblins, though I realised my initial assumption was wrong. But even when applied to Goblins, do they like to be pyroscipated? Far be it for me to suggest that the dwarves should bow to the wishes of their most[2] hated enemies spiritual needs[3] in order to sate them, but is it something appropriate to their kind? Is it the same as putting an elf in a harvested-wood coffin in a wood-panelled tomb with loads of illicit wood crafts littered around to further mock the deceased? Or are Goblin spirits happy with the flame treatment. (At least
after death, although I wouldn't be surprised if they didn't enjoy getting a magma shower immediately before they say goodbye to mortality, the little buggers.)
(BTW "light their clothes on fire"? I know I'm verbose, but isn't that a bit redundant? When there isn't any possibility of mistaking it for merely illuminating their clothing, of course.
)
@Urist McArmok: If any part remains 'intact' (at least individually, e.g. creepy roaming hands or rolling eyeballs), that needs to be dealt with. Perhaps if the entire corporeal self has been seared by magma and yet the spirit is restless[4] something similar to the engraving method: "Ho, most vile enemy, we defeated your flesh and by these runes we shall defeat your spirit! By marking your destruction upon this tablet of the vanquished we abjure your nameless spectral form to remain beyond the veil and never more to meddle in the land of the living!" Possibly only named creatures (including named wildlife, killed in hunting or military actions) need to go that far, the un-named ones fade away, or just add to the general aura of the place and make it easier for the next named goblin general to turn aggressively poltergeist-like.
[1] Well, everyone does in Adventure Mode, 'cos you can set trees on fire "for the lulz". Maybe they have them, that's how they start furnaces going. Which leads straight back to the "Workshop Pyre/Crematorium" idea anyway.
[2] Second most. Their most hated adversaries would just
love to be buried under a sapling, I suspect.
[3] Not mentioning a certain recent death, IRL.
[4] Given ghosts of dwarfs apparently wreak havoc among their former selves, would ghostly goblins mess with attacking forces? Or perhaps it is more that the dead dwarfs are complaining that their living comrades are forgetting about them, so a dead goblin would be equally/more aggressive towards the dwarfs that caused the untimely demise in question.