Would it be clearer/less explanation involved to use a name beginning with the same sound (such as Marlowe, Mara etc) or to use Pearl which is the meaning of Margaret? I feel like Pearl would have to be explained more as a lot of people don’t know name meanings?
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If I wanted to honour a relative named Margaret, I would probably use Margot or Marguerite as a middle name (I’m not a huge fan of Margaret myself, but I do like these names).
I think using Pearl is an option, but it depends on how obvious you want the honour name to be.
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To me a “Mar-” name would be clearer to most people than [name_f]Pearl[/name_f] would be. [name_u]Or[/name_u] else [name_f]Maggie[/name_f] or [name_f]Greta[/name_f].
Probably, but I would think that’s kind of fun! You’d get to share a fun fact that reveals a really smart and subtle honor name. 
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I think [name_f]Peggy[/name_f] would be very explanatory. Its a common nn for [name_f]Margaret[/name_f].
Other then that, [name_f]Maggie[/name_f] is great too.
If you want a full name, rather a nn, Marjorie/Margaery?
[name_f]Molly[/name_f]?
If I wanted everyone to know I was honouring a [name_f]Margaret[/name_f], I’d do something more obvious like [name_u]Marlow[/name_u], [name_f]Margot[/name_f] or [name_f]Greta[/name_f]
If i wanted to be more subtle, which i probably would, I’d probably go with [name_f]Pearl[/name_f]
I would use [name_f]Margaret[/name_f] or [name_f]May[/name_f], [name_f]Mabel[/name_f] would also be an option (although it has different origins). [name_f]Rita[/name_f] is nice too!
It would be slightly more indirect, but it would still be honoring the name! Margot and Marigold came to mind!
I’d probably go with [name_f]Margot[/name_f], personally.
I think [name_f]Mar[/name_f]- names and [name_f]Pearl[/name_f] make similar amounts of sense - not direct, will require explanation, but makes sense. I prefer [name_f]Pearl[/name_f] in this case since it seems like a more creative nod.
When I saw this title, [name_f]Maggie[/name_f] instantly came to mind-
Oftentimes, you will need to explain it anyway if it is not directly [name_f]Margaret[/name_f]- I’m seeing you are aware of this with how you phrased the post 
- so it would be worth it to take this into a creative direction! [name_f]Pearl[/name_f] would be a good choice, but others like Marl(en)a, [name_u]Marlowe[/name_u], etc. would do okay. Since [name_f]Margot[/name_f] is a direct diminutive, that would be a good variant unless the popularity gets to you? [name_f]Perla[/name_f] could also work since it sounds like [name_f]Pearl[/name_f].
I’d use [name_f]Margaret[/name_f] as a middle name
i would use Marietta - it has the “Mar” and the “et” ending! maybe a divisive choice, though. i would also consider Daisy, Pearl, Greta, Mary, or Marianne.
Meaning honors always feel more direct to me than similar sounds. I get that it’s not instantly recognizable to most people, but I really like the etymological link.
I would choose the name you like the most as there are many lovely options, and I think it is an important/nice gesture to personally tell the person being honoured that that is what you have chosen to do. You could explain likewise to those closest to you. That way the honouree is certain of your intent as there is always the possibility that you like a name that is similar to an acquaintance but that you are not honouring.
I worked with a girl named [name_f]Margaret[/name_f] but she went by [name_f]Maggie[/name_f], but my daughters middle name is the meaning of her grandmothers name which I love to tell people about when they ask.
The only person who matters about honoring is the person being honored. So if she knows, that would be enough for me.
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I adore the name Margaret, and I’d just use that, no nicknames!
More subtler versions I like best are Greta, Maggie, Daisy, and Pearl. They all sound classic, cute, and sweet—same vibes as Margaret has. 
I agree on the importance of this!
Maybe [name_f]Magnolia[/name_f], [name_f]Margot[/name_f], [name_u]Marlowe[/name_u], [name_u]Marley[/name_u], [name_u]Gray[/name_u] (from ‘-gare-’), or [name_f]Marjorie[/name_f]? Loving [name_f]Magnolia[/name_f] [name_u]Gray[/name_u] nn [name_f]Maggie[/name_f]!