Wait, put a new page on it (Page 3) just to clear the final confusion.
On Page 2, you should have the switch Old Man's Book is on precondition. Here he should say Please find my book soon.
On Page 3, you should have both the switch Old Man's Book and the Variable on. That's when he should say the last part.
For the variable to work, you need to edit the event that gives the character the book. Once you receive the book (as an item), make sure you use Variable Operation (Page 1 of event commands window), and make it look like this.
<> Variable [0001: Old Man's Book] += 1
On the second page of the same event (the one that GIVES YOU THE ITEM), make it activate on the same variable precondition you used in the third page of the Quest 1 event. On the page, make it say, there is nothing more here.
That should make it work.