In chapter 21, what accounts for the humor in this version of Hamlet's soliloquy?

Yes, it's pretty funny. Both the Duke and King have their lines messed up. In the soliloquy they mix the famous soliloquy with random scenes from both Macbeth and Hamlet. Here is an excerpt of how crazy it sounds,

"To be, or not to be; that is the bare bodkin

That makes calamity of so long life;

For who would fardels bear, till Birnam Wood do come to Dunsinane,

But that the fear of something after death

Murders the innocent sleep,

Great nature's second course.."