The equation in stmt 1 is fulfilled only if y-2 = 0, giving us y = 2. This does not help regarding the relationship between x and y, so 1 is insufficient.
The second equation helps establish that y = x + 1 or that y = -(x + 1). Since we cannot tell which case it really is, then this stmt is insufficient as well.
Put the two together and you get two cases from stmt 2:
a. y = x + 1 = 2 makes x = 1, which does not fit with the initial constraint that x is not 1
b. y = -(x + 1) = 2, making x = -1, which does fit with x being different from 1.
So I'd go with C.... Maybe I'm missing smth over here, I get a completely different answer....