Hi there, sorry I'm late.

Your question is a good one, and considering the value that Himalayan peoples place on their religious leaders, a difficult one to answer.

An important thing to consider is that the Tulku system (which you are mostly referring to, though there are other examples regarding "corruption in Eastern religions" when it concerns, say, translation of texts) claims to be locating reincarnates of certain religious teachers and leaders, but is very adepts at finding able individuals regardless of family or lineage, though those can come into play in questionable ways.

Let's take the Dalai Lama lineage as an example.

The Third Dalai Lama, (who was actually the first named Dalai Lama) Sonam Gyatso, was the spiritual teacher of the Mongol Altan Khan. Altan Khan was a grandson of Dayan Khan who was a descendant of Qhubilai Khan, himself a grandson of the famous Chingghis Khan. Altan Khan, though powerful in his own right, wanted to rule all of Mongolia and China as his ancestors (his grandfather's name was "Dayan" which was supposed to strike fear in the Chinese with its similarity to "Da Yuan," or "Great Yuan"). Anyway, he allied with the Gelukpas (the newest school of Vajrayana Buddhism) in Tibet, inviting Sonam Gyatso with the implication that Altan Khan might be declared the reincarnation of Chingghis Khan. This plan went through, and as a bonus prize, Altan Khan turned around and named Sonam Gyatso, "Dalai Lama," roughly translating to "Ocean of Wisdom Teacher."

Altan Khan's great-grandson, was later named as the reincarnate of Sonam Gyatso and became the Fourth Dalai Lama.

The Fifth Dalai Lama sheds a particular light on this subject through his autobiography.

I'll quote from Karma Phuntsho's The History of Bhutan directly:

[The trulku system] was based on the notion that certain religious procedures after or before the death of a religious master would lead to the identification of the child reincarnate but there was no certainty. The procedures were highly unclear and flexible and they often left the process of ecclesiastical succession prone to abuse and manipulation. After all, how could lamas conclusively prove that a child is a rebirth of a certain figure in the past when they could not even effectively prove rebirth itself?

Two notes here: Tibet and the Himalayas did not rely on tulku succession until very recently. The first tulku is usually drawn at the third Karmapa (1284-1339) and the founder of the Gelukpas, Tsongkhapa the "Great Reformer" was a teacher of the Kadampa school who actually didn't believe the tulku system should exist (presumably for this very reason, that it leaves the door to succession open to too many claimants). Though, ironically, his student Gedun Drup, would be declared the reincarnate of the famous Lama Drom. Gedun Gyatso would be declared the reincarnate of Gedun Drub. And Sonam Gyatso would be declared the reincarnate of Gedun Gyatso, and then Dalai Lama.

Another thing to consider about the above paragraph is that while there is a lot based on reincarnation in Buddhist philosophy and Tibetan (proto-)psychology, that it stems largely from Consciousness being one of the Five Skandhas. In short, "Consciousness" is one of the illusions that keeps us from Enlightenment. In Hinduism they usually talk about the transmission of atma from one body to the next as reincarnation, but Tibetan Buddhism talks about tung rab which is more of a "stream of consciousness," the persistence of an illusion.

Though this is drawn from a philosophical understanding that since consciousness does not begin, it also doesn't actually end.

The 5th Dalai Lama's account of how he was chosen on the basis of lies and exaggerations amply demonstrates this. When Tshawa Kachupa, who led the search party, showed him a statue and rosary of the previous Dalai Lama, he did not recognize them but Kachupa walkde out of the room and announced that he clearly did. Then, he was indirectly briefed about Panchen Lama's late arrival and when he later blurted out 'Panchen, you took time', the remark was interpreted as recognition of the Panchen Lama. Getting momentarily distracted by the long queue of people at the reception at Drepung, the five-year-old Dalai Lama forgot to bless Gedun Gyatsho [not the Gedun Gyatso mentioned above, who would have been dead for decades at this point], an attendant of the previous Dalai Lama, by touching the latter's head, and they claimed that this was an act from clear memory of the previous life. He is said to have recognized this monk who had displeased the previous Dalai Lama. 'Let alone Gedun Gyatsho, there was not a single person I recognized that day,' the 5th Dalai Lama later remarked. Similarly, when as a child he played with drums, this was interpreted as a habit from his previous life. He said: 'If all those who play such games are incarnate lamas, there would be indeed numerous of them.'

Though remember above that the tulku system's strength is in identifying extraordinary children regardless of lineage or means. The 5th Dalai Lama is known among Tibetans as "The Great Fifth," because he unified most of Tibet, allied with the Mongols to defeat his enemies, allied and taught the Qing Emperor, built social services in Lhasa including a fire department, and ended infighting in Tibet proper.

But we can segue to the Great Fifth's primary rival, the Zhabdrung of Bhutan: Most people are aware of how the Dalai Lama is chosen mostly by presenting children being considered with objects from his predecessor's past lives (like was done somewhat melodramatically in the Scorcese film Kundun. For those interested in a more realistic... well as realistic as it gets, look for the documentary Unmistaken Child). But this is just tradition for the Dalai Lama's lineage. There is no standard way of locating tulkus in general. Each tradition has its own methods of finding successors.

Before the Gelukpa, the majority school of Tibet was the Kagyupa, itself split into many subschools. The center of the Drukpa Kagyu school was Ralung and its founder was Tsangpa Gyarey. The lineage was passed from uncle-to-nephew, with the burden of reproducing being on the younger brother of the monastery's scion. As history progressed, this became an informal hereditary lineage, with the scions taking greater vows of celibacy after succession was assured, though some of these sons were being declared reincarnates of their grandfathers.

Cont'd