Here's a (crude) attempt to draw and label the figure



The basic idea:

* If the diagonal of the little squares is y, the sides of those squares are y/√2, or (y√2)/2, in proper form.

* Since the diagonal of the big square is (2r + 2y), the sides of that square are (2r + 2y)/√2, or √2(r+y), in proper form.

* Since the sides of the smaller squares sum to y√2, the distance between those squares on the sides of the big square is r√2 (i.e. PQ = r√2).

* Once you know r√2, you can find r, the radius of the circle, and solve.

* Since S2 gives you r√2, it's sufficient. Since S1 doesn't, it's not.