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PAD parses on the fly (on demand) it searches for the first }, then it takes the first { before it, and analyses it to see if it is a PAD tag or a PAD variable.
In below example, the {$myVar} part is parsed first and executed.
{pad myOption='{$myVar}', $xyz=789}
....
{/pad}
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Lets assume {$myVar} has the value ABC, then the result will be below, and now the {pad} tag will be processed.
{pad myOption='ABC', $xyz=789}
....
{/pad}
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If you do not put quotes around {$myVar} then below will be executed, and PAD will give the error that the constant ABC does not exists
{pad myOption=ABC, $xyz=789}
....
{/pad}
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