I dunno, the grades are pretty subjective in a lot of majors. I'm TAing for a machine-learning / data-mining class right now, and the assignments aren't mostly ones with objectively correct answers (it'd be easier to grade if they were). Instead, I have to read their writeups and determine if they picked interesting problems and formulated coherent hypotheses; if they used algorithms suited to those problems and explained why; if they demonstrated knowledge of how choices in algorithms or parameters would affect their results; and if they knew how to interpret the results properly and use a mixture of graphs and prose to effectively convey them.
It's possible it's less fuzzy, but there's still a good deal of fuzziness...