The sentence that is NOT grammatically correct is: B. Yo estoy me lavando las manos.
How to get the correct sentence
The correct sentence should be: A. Yo me estoy lavando las manos (I am washing my hands). This sentence follows the correct structure for reflexive verbs in Spanish, where the reflexive pronoun "me" comes before the conjugated verb "estoy" (I am).
In sentence B, "Yo estoy me lavando las manos," the placement of the reflexive pronoun "me" is incorrect. The correct structure for the reflexive verb "lavarse" (to wash oneself) should be "Yo estoy lavándome las manos" (I am washing my hands), as in sentence C.