TIL about lookahead and lookbehind.

The compact "code golf" version…

import re, sys

# everything in one "line"
print(''.join(re.sub(r'(?<=( ))(&&|||)(?=( ))', 
    lambda m: ['and', 'or'][m[2] == '||'], l)
  for l in sys.stdin.readlines()[1:]))

The somewhat easier to read version…

import re, sys

print(
  ''.join(
    re.sub(
      r'(?<=( ))(&&|||)(?=( ))', 
      lambda match: ['and', 'or'][match[2] == '||'],
      line
    )
    for line in sys.stdin.readlines()[1:]
  )
)

The somewhat easier to read version…

I've yet to see a HackerRank challenge requiring the "N" parameter on the first line of the input. I always read all lines in and skip the first one.