In many instances, the terms can be used interchangeably. Flooding is defined as
the submerging of land under water, esp due to heavy rain, a lake or river overflowing, etc.
Inundation is defined as
the process or an instance of being flooded
While inundation is defined as flooding, there are circumstances where flooding would be appropriate, but inundation would not. Inundation connotes extensive water presence. Flooding may sometimes be used to convey unwanted water, but in less than overwhelming amounts.
We has some minor flooding, and half of the basement floor was wet.
It is unlikely that someone would say minor inundation.
However, in the example given, I am at a loss to understand the distinction