This thread proves how much people actually do misunderstand probabilities and how they can change with change in knowledge. Of the respondents, 65.5% got the wrong answer. Let me make an attempt to explain why 33% is the correct answer.
At the start of the problem, we have only know that there are two puppies, but we have no idea what their sexes are. So, the possible outcomes are the following:
dog1 dog2
M M
M F
F M
F F
There are 4 possible outcomes. This means that the probability of each outcome is 1/4 or 25%. If we ask what is the probability that both dogs are male, the answer is 25%. This is because only one of the four outcomes is M/M. But, this is the case that we don't know anything at all about the dogs other than the fact we have 2 of them.
Now, let's suppose we are told that dog 1 is a male. This means that we now know the F/M and F/F outcomes did not occur. So now we ask what are the possible outcomes. The possible outcomes are
dog1 dog2
M M
M F
There are only 2 possible outcomes. So the probability of each outcome is 1/2 or 50%. If we are told that dog2 is the one that is male, then we have again 2 possible outcomes:
dog1 dog2
M M
F M
But, look closely at what happened as a result of our change in knowledge. While the first possible outcome remains the same, the second possible outcome is a different configuration from the case when we knew dog1 was the male. Regardless, because there are only 2 possible outcomes now, the probability of each outcome is 50%.
Now, here is where things change. In the problem, we are told that at least one of the dogs is male. But, we don't know which one. Because we don't know which dog is male, we must consider all possible outcomes in which there is a male dog. There are 3 such outcomes:
dog1 dog2
M M
M F
F M
Notice that the number of outcomes has changed to 3 because we don't know which dog is male, only that at least one is male. Because there are now only 3 possible outcomes, thanks to us knowing now that at least one dog is male, the probability of each outcome is 1/3 or 33%. The problem is asking us what is the probability that both dogs turn out to be male when we know that at least one dog is male. We see that only 1 of the three outcomes have both dogs as male. So, the probability that both dogs are male is 33%.
The KEY of this problem is realizing that the probabilities change as a result of our change in knowledge about the situation. Notice carefully how the probability of having 2 male dogs changed as a result in our change in knowledge about the situation. When we don't know anything at all about the two dogs, the probability of 2 males is 25%. When we know that dog1 or dog2 is the one that male, then the probability of 2 males is 50%. When we only know that at least one dog is male(but not which one), then the probability of 2 males is 33%.