It is hard to understand your question. Your example sentences make me uncomfortable. You use technical language, you use it in a weird way, and you use it inconsistently. Calibrate shows up one way in the Question ("the algorithm fails to calibrate correctly") and another way in a Comment ("algorithms may be used to calibrate some surfaces" -- suddenly calibrate has become transitive). Your conditional sentences are constructed strangely.
It seems that in sentence #2 we lose the "present" situation as if the related story were set in the past, which is not the case.
I think you were referring to the following example sentence you wrote:
If James asked them they would tell him the algorithm failed to calibrate correctly
It seems you are bothered by the word "failed" because it is in the past tense.
I am guessing that you have been uncomfortable with some conditional statements in English, noticing that a verb that would normally have been in the present tense gets put into the past tense in constructing the conditional expression.
Let's look at a couple of simple sentences:
1a. If Bob asks for the results, they will say the method fails.
2a. If Bob asked for the results, they would say the method fails.
Those sentences work, and they would also work with a past tense version of "fail":
1b. If Bob asks for the results, they will say the method failed.
2b. If Bob asked for the results, they would say the method failed.
In terms of grammar, both versions work just fine with fail in either the present or the past tense.
However, we might note that in Sentences 2a and 2b, there is a past tense in the "if" clause. That's just how the conditional works in English.
If this doesn't get to what you are trying to ask, I would encourage you to start fresh with a new question that doesn't have "calibrate" in it, with some helpful numbering to make it easier to talk about your example sentences.