Richard Dawson liked giving people lollipops. He saw it as a friendly gesture. If you watch some episodes of Feud before the lollipop trees, you might notice some family members with lollipops in hand. He'd also give out a bouquet of lollipops to members of the audience that he felt deserved recognition, like the elderly or children. Richard was known for having a very large ego, but he could also be very friendly and caring, and I guess they wanted to show that side of Richard. When it was evident the show would be cancelled, Richard gave away entire boxes of lollipops! I guess they had to do SOMETHING with all those lollipops! On the final show, Richard tearfully acknowledges a girl that he knew that was dying, and her final request was to have a lollipop in her mouth when she died. The girl's name was Nicole Kelly. Richard Dawson's daughter, who was born in 1990, was named Shannon Nicole, so it's likely she was named after this girl.
The stage originally had just one lollipop tree on one side of the stage. Richard commented on the air that there really should be two, one for each family, and I think the following week, there were two of them.
On a different topic, I always wondered why Richard's birthdays were always trumpeted on the Feud. Staff members would bring out a large cake, and one year, they flew in Richard's son Mark, who was living in England at the time. Richard apparently hadn't seen him for a while, and was so choked up, he said he couldn't possibly do the show. They played a quick couple rounds, and the families were both invited back the next show. I have a theory as to why they did this. Richard had a large ego, and the producers had their hangups about him, but I think they made such a big deal because they liked seeing Richard getting emotional and teary eyed. I think they liked throwing him off guard. It's interesting that despite his ego, that Richard seemed so humble, and acknowledged all the staff for being so kind.