Anniebach: Kensington Palace, St James palace and Windsor castle are not the queens property
Even if the Crown Estates income was passed to the government in the reign of George III the monarch clearly retained the right to allocate houses and appartments on the Crown estates and in the royal palaces. Given the position of the monarchy and the structure of society at the time I think it would have been strange if any other arrangements had been made. I suppose the Queen could move a few homeless families into KP if she wanted to but imagine the outcry...
en.wikipedia.org/wiki/Kensington_Palace
Kensington Palace is a royal residence set in Kensington Gardens, in the Royal Borough of Kensington and Chelsea in London, England. It has been a residence of the British Royal Family since the 17th century, and is the official London residence of the Duke and Duchess of Cambridge, Prince Harry, the Duke and Duchess of Gloucester, the Duke and Duchess of Kent, and Prince and Princess Michael of Kent.
Today, the State Rooms are open to the public and managed by the independent charity Historic Royal Palaces, a nonprofit organization that does not receive public funds.[2] The offices and private accommodation areas of the Palace remain the responsibility of the Royal Household and are maintained by the Royal Household Property Section.
en.wikipedia.org/wiki/Royal_Households_of_the_United_Kingdom
The Royal Households of the United Kingdom are the collective departments which support members of the British Royal Family. Many members of the Royal Family who undertake public duties have separate households. They vary considerably in size, from the large Royal Household which supports the Sovereign to the household of the Duke and Duchess of Cambridge and Prince Harry, with fewer than ten members. The lesser households are funded from the Civil List annuities, paid to their respective royal employers for their public duties, and all reimbursed to HM Treasury by the Queen.
According to this paper: tinyurl.com/zlk9uoh the Sovereign Grant is 15% of the income from the Crown Estates. As the grant is about £30million I make it that the actual income from the Crown Estates is about £200million p.a. (which goes to the Treasury). Without spending any more time googling I suspect that the balance which the Treasury retains is more than enough to cover activities (detailed in the linked pdf) which are not funded from the Sovereign Grant. So I would still contend that the taxpayer does not fund the Queen or the activities of more obscure members of the royal family.
I'm not particularly defending the Monarchy, though I'd much rather have the Queen than Donald Trump, I just think we should get our facts straight. I think that the question of why people should be extremely wealthy through no effort of their own (which applies to far more people than just the Queen and the royal family) is a completely different (and historically interesting) issue.