Explanation:

The temples developed during the Pallava dynasty reflected the stylistic taste of the individual rulers and can be classified into four stages chronologically.
Mahendra group:
This was the first stage of Pallava temple architecture. The temples built under Mahendravarman were basically rock-cut temples. Under him, the temples were known as mandapas, unlike the Nagara style in which the mandapas meant only the assembly hall.
Hence, statement 1 is incorrect.
Narasimha group:
This represented the second stage of the development of temple architecture in South India.
The rock-cut temples were decorated by intricate sculptures. Under Narasimhavarman, the mandapas were now divided into separate rathas. The biggest one was called the Dharmaraja ratha while the smallest one was called the Draupadi ratha. The design of a temple in the Dravidian style of architecture is a successor of the Dharmaraja ratha.
Rajsimha group:
Rajsimhavarman led the third stage of temple development. Under him, development of real structural temples was started in the place of rock-cut temples. Hence, statement 2 is incorrect.
Example: Shore temple at Mahabalipuram, Kailashnath temple at Kanchipuram, etc.
Nandivarman group:
This was the fourth stage of temple development during the Pallava dynasty. The temples built under him were smaller in size. The features were almost similar to the Dravidian style of temple architecture. After the decline of Pallava dynasty, temple architecture acquired a new style under the Chola kingdom, known as the Dravidian style of temple architecture. This marked a new era in the development of temples in the Southern India.