Bethany, you don't honestly believe that schools encourage families to get free/reduced lunch to get money for curriculum? First of all, the federal government gives that Title 1 and other money to schools based on the number of low income kids. Since low income kids generally live in areas that don't have the $ to support the schools through taxes, this money is being used as intended; for extra support in reading and math skills to close the learning gap that often exists for these kids. It is not the schools' job to report "lies," generally they take that documentation for what it's worth. The Department of Transitional Assistance (what used to be called welfare) are usually the ones who catch fraud, at least in my state.
The sorry fact is that all kids deserve an excellent education and this is one small way that bridges the gap. It doesn't come close to what is needed, which is a totally different way of funding public education, not entirely based on property values. I'm sorry that you've had some not so nice experiences with "the system," and I know this happens, but this one, cannot be blamed on the public schools. Other agencies, maybe.