I remember seeing several Jazz ensembles in the late 80's and early 90's with guys playing L-2000's and MM Sabres! As to whether or not it can handle funk, but the question is WHAT TYPE OF FUNK would needed to be answered first??!?! Are you looking for Mid-late 60's Jamerson/Jemmott, Mark Adams gritty funk, Bootsy effects laden synth funk, Bernard Edwards disco funk, Chuck Rainey Jazzy yet soulful funk, Cordell Masson spacey funk, George Porter gumbo drenched Second Line Funk, James Alexander's deep Memphis/Mississippi Funk, or Rocco Prestia's eighth note rapid fire funk?
It's a tool. IMHO you can pull of any genre with most any instrument. Bela Fleck pulls off Jazz with a banjo (hell, I saw a guy do jazz numbers with bagpipes), Skyy pulled off funk with Kazoos, you can do whatever you want with an L-2500!