On May 8 / Liberation Day ... is everything closed in Prague ? We will be driving from Budapest and wondering if the shops & restaurants will be opened on the way.

Correction ... We will be coming from Vienna ... (not Budapest)

no,as a tourist you won't find it much different from any other day.On the monday the roads might be a bit quieter as folk take advantage of a long weekend but as far as shops ,resturants and tourist sites are conmcerned it buisiness as usual.

You say you are driving,will you have a rental car?
if so please chech with the rental company to se of they allow their cars to go into the Czech republic,many do not.

unclegus ... Thank you for your input. We are going to hire a car & driver to take us from Vienna to Prague. Do you know of any quaint towns we could stop at on our way to Prague ? Also, how long will it take to get there by car ? Thank you

most of the quainter ppaces i know are nearer to Prague,but have a word with your driver i am sure they will be able to finsd somewhere nice to stop off for a break.
No idea how long it will take by car,I have been to both places but never travelled between them.
looked up travel math and they are suggesting nearer 4 hours
http://www.travelmath.com/drive-time...Czech+Republic

unclegus ... Thank you again