At least they have a process. That gives you a chance. Often the process itself is good - you didn't test it but the vendors all did and so the data is there - it might be hard to restore, but it can be done by experts after the fact. The drill means you can recover in a "short time" instead of a "long time" (short time can range from minutes to days, while long time days to years)
yes and no.
I've ran drills with companies which concluded that the incremental backups couldn't be restored due to some data corruption issue (no readback test was ever done).
Luckily the company also did a full backup every 6 months, so a disaster would have only thrown them back 6 months at max! /s ;)
But yes, some issues were even more simple: I had a case where performing a restore required twice the storage size of the uncompressed data, and the company actually didn't have the infrastructure ready to do that in case of a disaster...