Narration: past tense

#1 He said, "When I saw them they were cooking food".

A. He said that when he had seen them, they had been cooking food. (my answer)

B. He said that when he saw them they were cooking food. (Answer sheet)

I read a rule saying, we change past indefinite and past continuous into past perfect and past perfect continuous respectively. So why answer A is incorrect?

#2 She said to me, " I was thinking of helping her but changed my mind later on".

A. She told me that she had been thinking of helping him but changed her mind later on.

This is given in book. Here, "was" changed to "had been", but "changed" was not in "had changed". Why so?

Indirect speech construction of past tense always confuse me. I have seen sometimes it changes tense, but sometimes its not. So I lose marks in my examination. Can you please help with some example in which cases we change the tense or not.