Festschrift articles: is the peer-review as strict as for other papers?
In my experience in mathematics, papers submitted to a Festschrift are held to the same standard as any other papers as far as correctness and novelty go, but there is definitely some flexibility regarding importance.  The Festschrift is often considered a good place for articles that would be of particular interest to the person being honored, because they build on this person's work or involve topics close to their heart, even if the papers are not particularly important in absolute terms.  Referees know the paper is submitted to the Festschrift, and I think this vision of which papers are appropriate is broadly shared among authors, editors, and referees.  An embarrassing or inappropriate paper would be rejected, but for example a minor observation related to the honoree's work could be accepted.

It's hard to say how this compares with typical journals, since there's a range from low-end journals that will publish anything arguably new and correct to high-end journals that regularly reject excellent papers because they aren't quite wonderful enough.  A Festschrift will never match the very most prestigious journals (there simply aren't enough thematically-appropriate papers at that level to fill it up), but it can be comparable to a middle-of-the-road journal or occasionally better.

As in Stephan Kolassa's comment, a large majority of the Festschrifts I've seen are monographs, rather than journal issues.  When they are special issues of a journal, it's generally not a particularly prestigious journal.  (However, it can happen: the Duke Mathematical Journal published a Festschrift for Nash.)  My interpretation is that prestigious journals generally don't want to publish Festschrifts because they know the papers won't all meet the highest standards of importance.