I solved in the following way
First square both sides
We get 'Is xy>0" , or in proper english do 'x' and 'y' have the same sign?
Statement 1: Obviously insufficient
Statement 2: Square both sides again ---> x^2 > x^2 - 2xy + y^2
y^2 - 2xy < 0
y (y-2x)<0
So two cases:
If y>0, then y-2x<0 and 2x>y>0. Answer is YES
If y<0, then y-2x>0 and 2x<y<0. Answer is YES again
Sufficient
Answer: B
First square both sides
We get 'Is xy>0" , or in proper english do 'x' and 'y' have the same sign?
Statement 1: Obviously insufficient
Statement 2: Square both sides again ---> x^2 > x^2 - 2xy + y^2
y^2 - 2xy < 0
y (y-2x)<0
So two cases:
If y>0, then y-2x<0 and 2x>y>0. Answer is YES
If y<0, then y-2x>0 and 2x<y<0. Answer is YES again
Sufficient
Answer: B









