The use of SlotSequence in If[#1 > #2, ##] &

The answer is simple: First, you really need to look up the documentation of ##. It means "take all arguments". But more importantly, you can use the property that a > b stays unevaluated when neither true or false can be computed. So check this out:

If[#1 > #2, ##] &[a, b]
(* If[a > b, a, b] *)

Do you see how ## converts this construct into a simple "if a>b then a else b"?

Furthermore, Sequence[a,b,c] is Mathematica's way of saying "a sequence of arguments that can be fed into a function". As you might know, it is not possible to evaluate the input a,b,c without error. For normal functions, which don't have the attribute HoldAllComplete, a Sequence[...] expression is always flattened out.

func[Sequence[a, b, c]]
(* func[a, b, c] *)

This is exactly what happened in your If. When you understand that

## &[22, 21]
(* Sequence[22, 21] *)

and you know it's turned into a real sequence (without the Sequence around it) when inside a function, you understand what happened in your case.

To understand how the SlotSequence (##) works, use Trace

Trace[If[#1 > #2, ##] &[22, 21]]

Trace[If[#1 > #2, ##] &[21, 22]]