Your Question #1 uses the grammatically correct structure: “If it could talk, what do you think
it would tell?”
That question is in the form of the so-called second conditional sentence, which is used to denote unreal—meaning impossible—or improbable situations. Evidently, the use of the pronoun “it” in that sentence indicates that the subject is not a person but an animal, say a dolphin or a whale, or perhaps an inanimate thing in the figurative sense, say a wall or a lamppost. In any case, that “it” couldn’t talk so the situation described in that sentence is unreal if not downright impossible. (I must also say that the improbable use of the pronoun “it” for that “talking” subject is one other reason why the grammar and semantics of that sentence are rather slippery.)
As we know, a conditional sentence normally contains two clauses, the condition or premise (protasis) and the consequence or conclusion (apodosis). In the case of the conditional question you presented, the components are the following:
Condition or premise: “If it could talk”
Consequence or conclusion in the indicative mood: “it would tell (something)”
However, in the sentence in question, this consequence is stated in the form of a question, “What do you think
it would tell?”
Of course, the bigger question at issue here is why that form of the question is grammatically correct and this other form preferred by your authors is incorrect: “If it could talk, what do you think
would it tell?”
The answer is simply this: in English, a question normally can’t be nested within another question. After a question is raised by the use of the interrogatives “what,” “who,” “why,” when,” “where,” or “how,” it’s mandatory for it to be grammatically followed by the question’s premise in the form of an indicative statement. The correct question form is therefore “What do you think it would tell?” where the question “What do you think”” is followed by the indicative “it would tell.” In contrast, in the form preferred by your authors, “What do you think would it tell?”, the question “What do you think” is followed by another interrogative, “would it tell?”—a form that runs counter to the proper form for a question.
I realize that this explanation alone may be a hard to appreciate and accept, so I’m offering this other test to demonstrate which of the two forms of that conditional question is correct—reverse the order of the condition and the consequence in that sentence.
Your version: “What do you think
it would tell if it could talk?”
Your authors’ version: “What do you think
would it tell if it could talk?”
This time I think it’s pretty clear that the first is not only the correct but also the better-sounding question.