Earlier quoted context omitted.
Right, but if SHA1(m) = SHA1(n), then SHA1(SHA1(m)) = SHA1(SHA1(n)) also. The converse is not true. There will be cases where SHA1(SHA1(m)) = SHA1(SHA1(n)), but SHA1(m) != SHA1(n). (Or does SHA1 somehow guarantee that this will not happen?) So it seems to follow that the chances that H(a) = H(b) when H(m) -> SHA1(SHA1(m)) must be higher than when H(m) -> SHA1(m). Am I missing something?
I think you're going to need to better explain the logic behind graf 2 before I can answer you. But on the off chance that we can end this thread gracefully, I'll point out that SHA256(SHA(256(m), m) is SHAd256(m), and considered by Ferguson to address security concerns in straight SHA256.
If SHA1(n) = SHA1(m), we know SHA1(SHA1(n)) = SHA1(SHA1(m)). (this is a consequence of SHA1 being deterministic)
Also, even if SHA1(n) != SHA1(m), there is still a chance that SHA1(SHA1(n)) = SHA1(SHA1(m)). (this is a consequence of collisions: SHA1(a) may equal SHA1(b) even if a != b.)
So the probability that SHA1(SHA1(n)) = SHA1(SHA1(m)) must be more than the probability that SHA1(n) = SHA1(m).