I don’t see any harm in paying the legacy in cash if the recipient requests it and is prepared to attend in person to collect and give a receipt. I’d be reluctant, for prudential reasons, to pay it to a third party unless I knew both well- which is not, I assume, the case here. If you have reason to suspect that the beneficiary is asking for this in order avoid loss of benefits (unlikely with a legacy of £2000, but possible) your dilemma is greater. Personally, I think the entitlement to the legacy overrides your scruples about how the beneficiary may use it.
A contrary view is expressed in the latest philippic from the SRA about personal injury practice, where they say:
You should not make payments where there is any concern that the client may be avoiding liabilities eg bank overdraft, benefits claw back. Cheques made payable to the client must be given or sent to the client at their address.
It is surely a matter for the client alone whether he pays a legacy into an overdrawn account or chooses some other more gratifying way of receiving his damages, or for that matter, a legacy. Once again, I think the SRA are overreaching themselves.