in tools/picard.py::FastqToSamTool, if a single fastq file with interleaved paired-end reads is provided, the resulting bam file includes all of the reads, but discards pairing information (i.e. none of the mate flags are set). The function should be changed to preserve pairing information. It may be necessary to split out the */1 and */2 reads to separate fastq files (or input via separate named pipes?)
Compare with samtools import -s