The Difference Between Rationality and Intelligence

First, I still don't think it's fair to characterize the questions ("which is more likely" and "which has more M&Ms") as "nonsensical and purely logical." I wouldn't even call the questions atypical. We contend with simple questions like this all the time in society. The intent behind both questions is unambiguous, and there are no reasonable alternative interpretations, unless you assume the question asker is simply mistaken.

Second, we're on different pages about what the experiment is evaluating. I don't claim that the people who answer incorrectly are less capable of rationality, nor that they don't understand probability. What I believe is that they are less likely to recognize when it's best to apply their logical toolset. As a result, they're more likely to use intuition to answer questions that are best answered via careful analysis. This appears exactly like failing to understand the question itself.

To wit: The younger kids used the length of the line to answer "which has more M&Ms", but the older kids immediately recognized that it's better to use a more in-depth analytical tool: counting. I hypothesize that the younger kids are simply not as good (yet) at knowing when to apply this tool. Intuition is easier and less effortful, thus it's the default unless we make ourselves think harder. This pattern extends to adults, too. How many people think we should be tougher on crime because it "feels" like there is more violence today than ever before, yet don't even consider that they need to look at some actual numbers to justify this conclusion?

I don't see much in the literature regarding retardation of abstract thought due to the formation of myelin.

Quite the opposite.

https://en.m.wikipedia.org/wiki/Myelin

"Myelin is a fatty white substance that surrounds the axon of some nerve cells, forming an electrically insulating layer. It is essential for the proper functioning of the nervous system."

Further

"Myelination continues through the adolescent stage of life."

And finally

"The main purpose of a myelin layer (or sheath) is to increase the speed at which impulses propagate along the myelinated fiber"

I'd say myelin is a pretty good thing.

Pat Wolfe, in "Brain Matters: Translating Research into Classroom", goes on...

https://books.google.nl/books?id=BzccMxS56LAC&pg=PA79&lpg=PA...

"Neurons in the frontal lobe receive a myelin sheath late in development, as evidenced by the increased ability of children to engage in higher-level and more abstract thinking."

I'm really stretching to understand how to interpret the conjunctive here

In other words it can make things faster, but limit capacity for change and reduce broader neurological firing.

Sorry I haven't explained it very well - on the run with a phone.

I would strongly encourage a read of Pocket Guide To Interpersonal Neurobiology by Daniel Siegel, who touches on the neurobiology and broader aspects of the impact in an accessible narrative.

The kernel of what I seem to recall driving my original comment was that mylenation occurs at deep levels, during what we call the formative years, but if not adequately developed people can be or become susceptible to various negative psychological traits such as addiction, susceptibility to brainwashing, poor decision making, lack of critical thinking. As Max Planck put it - people don't change their mind to accept an idea, rather people die and everyone that's left just accepts the idea as true. A large part of what he was getting at is, I believe, a direct consequence of mylenation - namely the formation of faster but hard to change pathways in the brain.

I hope that explanation helps.