In the preview of The Walking Dead Season 2 Episode 4: "Cherokee Rose" we see an impromptu memorial service being held for Otis. His bereaved wife asks Shane to tell them what happened, what his final moments were like.
Put on the spot, Shane has to lie to them, and restates the story he told Rick and Lori upon his return from the high school. If you watch him closely, he appears to avoid eye contact as he speaks. At the end of the scene, Shane places a rock on a pile, which is Otis's grave marker. Otis was not buried, it's just a memorial- it would be far too dangerous to return to the high school in an attempt to find what little would remain of his body after the herd of walkers dug into him for a midnight snack.
Watch the preview for Episode 4 here
This sneak peek photo from Episode 4 shows Daryl outside of an abandoned house. I wonder if he'll find Sophia in there...
If you missed episode 3, you can catch a recap video of the main events here