Statement-I Analysis:
The reaction shown is the **Reimer-Tiemann reaction** (Phenol + CHCl$_3$ + NaOH). The major product is **Salicylaldehyde (o-hydroxybenzaldehyde)**. The ortho-isomer predominates due to the stability provided by intramolecular hydrogen bonding. Thus, Statement I is correct.
Statement-II Analysis:
The ortho-isomer has intramolecular hydrogen bonding, which lowers its boiling point (more volatile). The para-isomer has intermolecular hydrogen bonding, leading to a higher boiling point. This difference in volatility allows them to be separated by steam distillation. Thus, Statement II is correct.
Conclusion: Both statements are true.