I think I can confirm that dnsmasq behaviour changed in 7, but I can’t find a reference in the changelog. A quick inspection of the code didn’t reveal the change, either.
Before asking dnsmasq developer, I think we need to re-evaluate the usage of the strict-order option (from here):
That’s one reason why “strict-order” is broken and not recommended.
@jrieder, to solve your problem you may try to explicitly tell dnsmasq to query your internal dns for internal host names.
Add a template-custom for dnsmasq.conf (27internal_dns) containing:
server=/home.lan/10.0.1.8
I have a long-standing feature request for a panel to configure these options.
P.S. Impressive bug report.