(1+y)^2-2x^2(1+y^2)+x^4(1-y)^2
=(1+y)^2-2x^2(1+y)(1-y)+x^4(1-y)^2-4x^2y^2
=[(1+y)-x^2(1-y)]^2-4x^2y^2
=(1+y-x^2+x^2y)^2-(2xy)^2
=(1+y+2xy-x^2+x^2y)(1+y-2xy-x^2+x^2y)
=[(1-x^2)+(yx+y)+(x^2y+xy)][(1-x^2)-(xy-y)+(x^2y-xy)]
=(x+1)(x-1)(x-xy+1+y)(x-xy-1-y)