The Sandwich Islands are modern day Hawaii, if this was unclear to you. The full text from Mark Twain in Hawaii: Roughing It in the Sandwich Islands is as follows:
"Forty years ago it was the custom in the Islands to suspend all law for a certain number of days after the death of a royal personage; and then a saturnalia ensued which one may picture to himself after a fashion, but not in the full horror of the reality. The people shaved their heads, knocked out a tooth or two, plucked out an eye sometimes, cut, bruised, mutilated or burned their flesh, got drunk, burned each other’s huts, maimed or murdered one another according to the caprice of the moment, and both sexes gave themselves up to brutal and unbridled licentiousness." ..."And after it all, came a torpor from which the nation slowly emerged bewildered and dazed, as if from a hideous half-remembered nightmare. They were not the salt of the earth, those “gentle children of the sun.”"
Is there any truth to this, or is it part of the Twain humor and comic historiography? or subtle white colonial mindset that treated those such as the Hawaiians as dark savages and hammed up this image of them at every turn? It seems hard to take as fact (to me).
Actually it wasn't that unusual, we took our chiefs pretty seriously, or at least a well-loved chief. The descriptions are definitely tainted with a little bit of Twaining it up for entertainment and titillation , "Unbridled licentiousness," etc., but at the death of a chief, most of the rules of society are thrown out. Here's a link to Ellis, a British missionary visiting the American missionaries in Hawaiʻi. Page 174-182 are all about mourning. https://books.google.com/books?id=A5EDAAAAQAAJ&dq=polynesian%20researches%20kaahumanu&pg=PA174#v=onepage&q&f=false He's a missionary and there's some bias in the wording, obviously, but he's usually considered a trustworthy sources and his description matches a lot of descriptions given by Native sources that I can't access from home.
Back to the grieving, there's actually two things going on. The first is mourning over a chief, just like mourning over anyone beloved, where wailing etc., would be common. Physical dismemberment and self mutilation were common, sometimes taken to extremes. (Breaking out of teeth is a commonly referred to one.) Itʻs a display of grief and therefore a display of aloha for the dead. Tattooing ones tongue or other body parts. Iʻve seen images of people who tattooed the date of Kamehameha's death and his name on their bodies as a sign of mourning as well. Less extreme versions of this include shaving ones heads, I've seen references to mohawk like haircuts used as a visual expression of grief.
Burning down a house (hale) would be another expression of this mourning and loss, but not as big an expression as one might think. The hale were small thatched structures and could be rebuilt in a day or so. One usually kept important goods in other structures, and usually oneʻs family lived in a series of structures with each having a different purpose, so if one or two get burned, it wasn't a big deal. The murder part seems to be mostly references to it, not direct witnesses, however, weirder shit could happen.
The other thing that's happening is a symbolic period of lawlessness before the return of order under the heir to the chieftainship. The ruling chief brings order to chaos, therefore his death symbolizes a new period of chaos that has to be ended by the new chief. The main example of this is the ʻai noa, free eating, an disregard from the eating taboos that were normally enforced. Other periods such as the yearly Makahiki festival followed a similar pattern, the chiefs retreating, chaos coming, then the chiefs returning. (see Dening below) Usually this was a throwing off of taboos and a period of feasting/games/ceremony to Lono, one of the major gods, but also a period where sexual relationships were typically opened up, etc. In general, however, Hawaiian sexual relationships, hell Eastern Polynesian sexual relationships were pretty open. This was seen as horrific barbarity by the missionaries in general, but particularly during a time of mourning.
My books are all at my office, so I can't get some of the sources I want, from a quick internet search though, here's a link to a relevant section of Gayan Obeyeskere, who isn't exactly a Hawaiʻi expert but in this case his sources check out. https://books.google.com/books?id=r7uMcVV0J-UC&pg=PA187&lpg=PA187&dq=mourning+after+death+of+kamehameha&source=bl&ots=wYqTmHj7_f&sig=8USROtlpby2yrHGqRGzbSeH3oTo&hl=en&sa=X&ved=0ahUKEwiUneCwqv7KAhVBxWMKHbZRCBwQ6AEIUjAJ#v=onepage&q=mourning%20after%20death%20of%20kamehameha&f=false
but if I recall correctly there is some information about mourning in:
Marshall Sahlins, Historical Metaphors and Mythical Realities: Structure in the Early History of the Sandwich Islands Kingdom. Ann Arbor: University of Michigan Press, 1981.
Greg Dening, Mr Bligh's Bad Language actually has some interesting things about the Makahiki festival that are relevant here.