Statement:1 The units digit of x^2 is the same as the units digit of y^2.
So x^2 can be 36 and y^2 can be 16, so x-y will be 6-4 that is 2,
Also x^2 can be 196 and y^2 can be 16, so x-y will be 14-4 that is 10, hence true . Therefore Statement 1 is insufficient.
Statement 2: The units digit of x is 1.
No information about y. Hence x-y could be anything, therefore Statement 2 is insufficient.
Now Combining both the statements:
So, by that the possible value of x can be "1","11","21","31" ...and so on.
And by statement 2, the square of "X" will always end with "1"
the possible value of y^2 can be "81","121","441"..."41^2","15^2".....
Now for all the values of "Y" the statement will hold true except "Y^2 = 81 and Y = 9" as then x-y will not be divisible by 10 say (11-9). Hence both of them are also insufficient together as well.
Hence "E" should be the answer