Remember that a line in space can be given in parametric form $x=x_0+\alpha t$, $y=y_0+\beta t$, $z=z_0+\gamma t$,
where $x_0$, $y_0$, $z_0$, $\alpha$, $\beta$, $\gamma$ are constants, and $t \in \mathbf{R}$.
Let $x=1+t$, $y=2+t$. Then
\[
z=(2+t)^2(1+t)^2=3+2t.
\]
So we have a line $(x,y,z)=(1+t,2+t,3+2t)$. Similarly, let $x=1+t$, $y=2t$. Then
\[
z=(2t)^2(1+t)^2=36t.
\]
So we have a line $(x,y,z)=(1+t,2t,36t)$.
We will prove that these are the only two lines on $z=y^2x^2$ through $(1,2,3)$. Assume that $x=1+\alpha t$, $y=2+\beta t$. Then
\[
z=(2+\beta t)^2(1+ \alpha t)^2=4+4 \beta t + \beta^2 t^2 1 2 \alpha t  \alpha^2 t^2.
\]
In order for us to have a line, the coefficient of $t^2$ must be zero. Hence $\alpha^2=\beta^2$, and $\beta= \pm \alpha$.
For definiteness, assume that $\alpha=1$. Then $\beta=\pm 1$, and we have the two cases above.
We could make the same kind of argument to show that given any point on the surface $z=y^2x^2$, there are exactly two lines
through the point and lying on the surface. But we can finesse the problem to make the computations even easier.
We make the change of variables
\[
x=XY, \quad y=X+Y, \quad z=4Z.
\]
Then
\[
4Z=(X+Y)^2(XY)^2=X^2+2XY+Y^2X^2Y^2+2XY,
\]
and we obtain a particularly simple equation for the hyperbolic paraboloid:
\[
Z=XY.
\]
The critical thing is that the change of variables is linear; lines are mapped to lines.
In our problem, the point was $(1,2,3)$. Under the change of variables, this becomes $(\frac{3}{2},\frac{1}{2},\frac{3}{4})$.
The lines that pass through this point and lie on the saddle surface have either $X$ or $Y$ constant:
\[
(X,Y,Z)=\left(\frac{3}{2}+s,\frac{1}{2},\frac{3}{4}+\frac{1}{2}s\right) \quad \mbox{and} \quad
(X,Y,Z)=\left(\frac{3}{2},\frac{1}{2}+t,\frac{3}{4}+\frac{3}{2}t\right),
\]
where $s,t \in \mathbf{R}$.
In general, the two lines passing through the point $(X_0,Y_0,Z_0)$ and lying on the surface $Z=XY$ are
\[
(X,Y,Z)=(X_0+s,Y_0,Z_0+sY_0) \quad \mbox{and} \quad (X,Y,Z)=(X_0,Y_0+t,Z_0+tX_0).
\]
Thus we have two families of lines that rule the saddle surface. The lines in each family do not intersect because
if two such lines intersected, the intersection point would be on three lines on the saddle surface. Furthermore,
every pair of lines from different families intersect. For two such lines have equations
\[
(X,Y,Z)=(X_1+s,Y_1,Z_1+sY_1) \quad \mbox{and} \quad (X,Y,Z)=(X_2,Y_2+t,Z_2+tX_2),
\]
and the lines intersect at the point $(X_2,Y_1,X_2Y_1)$, when $s=X_2X_1$ and $t=Y_1Y_2$.
For a discussion of ruled surfaces, see the following text.

D. Fuchs and Serge Tabachnikov, Mathematical Omnibus, Thirty Lectures on Classic Mathematics, American Mathematical Society,
Washington, DC, 2011.