How long will Valygar's dead carcass keep? If I dump him in my barrell outside the Copper Corenet, will he be there when I get back? I wish I could find a good meat locker around for all these valuable dead people. Thanks.

If you put it in a container it will always stay there. I even think it could stay on the ground forever.

It will definately remain forever once in a container,even on a table at the copper coronet.
On the ground it will disappear after some time

I am not sure about that. Items that are vitals to the game don't diseaper from the ground.

I thought if you dropped someone's body, you could never get it back...?

In my experience items or bodies put into some form of container will stay forever - be it a box, chest or table.
Items or bodies on the ground which are vital for the game will stay forever too - the problem here is you can´t be sure the game agrees with you about what is vital or not ;) ...
*Vital* in a game sense means any item or body absolutely neccessary to continue the game not just neccessary to complete a specific quest for example.

Alexander, i think you are confusing the item "Valygar's Body" and kicking a dead guy NPC out of your party. Valygar's body is considered a game-essential item, so will never decay. Items in containers of any kind will never decay, nor will game-essential items. Items on the ground that are not game-essential will decay after about 2 days or so. (so don't store weapon components on Cromwell's floor!) If you kick out a dead NPC, he/she's gone for good, until ToB, maybe.

Does the Spirit of Fates work on dead former party members?