What happens to a zweilous’s second head when it evolves? Do both its heads become the hydreigon’s hands? Are the hand-heads conscious like the main head?

Evolution is a bit more complex than it looks, I must admit. During evolution, pokémon convert themselves to an energy state and reform into the shape best suited to maximize their power. In zweilous’s case, their heads first merge, then split back apart so that the pokémon operate on one central brain but maintains their ability to attack with multiple mouths. It’s the best of both worlds, essentially.

In other words, the central head is the merger of both of zweilous’s heads, but the hands do in fact have rudimentary intelligences themselves, as they contain fragments of both original brains.