Step 1: Understand what the question wants.
We have two statements about Class Reptilia and we must judge each one as correct or incorrect, then pick the matching option.
Step 2: Decode the name Reptilia.
The word Reptilia comes from a Latin root meaning to creep or to crawl. So the class name itself points to the creeping or crawling style of movement, as most reptiles drag their belly close to the ground because their limbs are placed on the sides.
Step 3: Judge Statement I.
Since the name genuinely refers to the creeping or crawling mode of locomotion, Statement I is correct.
Step 4: Recall the usual reptile heart.
A typical reptile has a three chambered heart with two atria and one partly divided ventricle, so at first glance Statement II sounds reasonable.
Step 5: Spot the important exception.
Crocodiles, which belong to order Crocodilia within Reptilia, have a fully divided ventricle and therefore a true four chambered heart. So it is wrong to say that ALL reptiles have a three chambered heart.
Step 6: Judge Statement II and combine.
Because of the crocodile exception, the word all makes Statement II incorrect. With Statement I correct and Statement II incorrect, the right choice is the option that says exactly that.
\[ \boxed{\text{Statement I is correct but Statement II is incorrect}} \]