Statement I: The reaction of phenol with CHCl3 and aqueous KOH is the Reimer-Tiemann reaction. In this reaction, the major product is o-hydroxybenzaldehyde (salicylaldehyde) due to the formation of a stable six-membered chelate ring via intramolecular hydrogen bonding. p-hydroxybenzaldehyde is formed as the minor product. Thus, Statement I is false.
Statement II: o-hydroxybenzaldehyde (salicylaldehyde) has intramolecular hydrogen bonding, making it more volatile (steam volatile). p-hydroxybenzaldehyde has intermolecular hydrogen bonding, which leads to association between molecules and a higher boiling point, making it non-steam volatile. Therefore, the mixture can be easily separated by steam distillation. Thus, Statement II is true.
Conclusion: Statement I is false but Statement II is true.