The original statement, with thetaθ added for sensibility.
(2cos^2theta-1)^2/(cos^4theta-sin^4theta)=1-2sin^2theta(2cos2θ−1)2cos4θ−sin4θ=1−2sin2θ
Let's work the left hand side.
Using one form of the cosine double angle formula, cos(2theta)=2cos^2theta-1cos(2θ)=2cos2θ−1, the left side becomes
(cos(2theta))^2/(cos^4theta-sin^4theta)(cos(2θ))2cos4θ−sin4θ, or equivalently cos^2(2theta)/(cos^4theta-sin^4theta)cos2(2θ)cos4θ−sin4θ
Then, notice that the denominator is a difference of squares, it can be factored as follows: a^2-b^2=(a+b)(a-b)a2−b2=(a+b)(a−b). In this case a=cos^2thetaa=cos2θ and b=sin^2thetab=sin2θ. So the left side is now
cos^2(2theta)/((cos^2theta+sin^2theta)(cos^2theta-sin^2theta))cos2(2θ)(cos2θ+sin2θ)(cos2θ−sin2θ)
Now we can use the Pythagorean Identity, sin^2theta+cos^2theta=1sin2θ+cos2θ=1 to get
cos^2(2theta)/((1)(cos^2theta-sin^2theta))cos2(2θ)(1)(cos2θ−sin2θ), or equivalently cos^2(2theta)/(cos^2theta-sin^2theta)cos2(2θ)cos2θ−sin2θ
And if we can use another form of the cosine double angle formula, cos(2theta)=cos^2theta-sin^2thetacos(2θ)=cos2θ−sin2θ, we can see that
cos^2(2theta)/cos(2theta)cos2(2θ)cos(2θ)
Simplifying this gives a friendly
cos(2theta)cos(2θ)
And using the third and final form of the cosine double angle formula, cos(2theta)=1-2sin^2thetacos(2θ)=1−2sin2θ, the left hand side finally becomes
1-2sin^2theta1−2sin2θ
And since 1-2sin^2theta=1-2sin^2theta1−2sin2θ=1−2sin2θ, the left side is equal to the right side and the identity is proven. Q.E.D.