- I thought "while" contains the element of duration and hence requires a progressive form?
2.1 BTW, Is the above question even grammatically correct?
Or should it have been:
- I thought "while" contained the element of duration and hence required a progressive form?
I read something about verb tense consistency within a sentence and to not switch from one tense to another unless the timing of an action demanded that you did. Is this the case here?
I can answer your 2.1 question. :)
Both versions are fine, and are grammatical.
(Note that in my discussion, I'll be using the term "preterite". "Preterite" means the same thing as "a past-tense form of a verb".)
The preterites that you are asking about in your 2nd version are backshifted preterites. This has nothing to do with the past time usage of the preterite.
First, a little info about preterites. Preterites have three main uses: "past time" usage, modal usage, backshift usage. The usages are mutually exclusive -- that is, within a sentence a single preterite can only be used for one specific usage.
Backshifting is usually optional (though sometimes obligatory), and usually happens in constructions were one clause is embedded within a larger one that contains a preterite verb. Backshifted preterites are commonly used in indirect reported speech. For example, the original utterance could be, when I say to Tom early in the day:
Then later, I could use indirect reported speech in my conversation with a friend, and both of the following are acceptable:
The last version uses the backshifted preterite "was"; and backshifting is allowable because the matrix clause's verb "told" is itself a preterite.
In your example question:
Your #B version uses backshifted preterites, which is allowable because the matrix clause verb "thought" is itself a preterite. (It so happens that "thought" is a "past time" usage of a preterite.)
In general, the meaning of the two versions of a sentence (non-backshifted vs backshifted) will usually be the same, but sometimes they aren't -- and even if they are different, often the difference isn't really significant. Sometimes the backshifted version might be ambiguous as to meaning, if that version was looked at in isolation; context will often make it clear as to the intended meaning. Sometimes there might be ambiguity in meaning due to the possibility that a preterite could be either the backshifted preterite or the "past time" preterite.