Energy & Condition
Energy is directly related to and influenced by a horse's athleticism. When a horse races, it loses energy. A horse gains energy back each new meet (A and B) or each month when there is only one meet. Not all horses lose and gain energy at the same rate, so you will find that some horses can race much more often than others.
Energy is NOT a reflection upon a race being too long (or too short). A longer race will not make a horse more tired than a shorter race. Race notes indicating fatigue also have nothing to do with the distance of the race - they are referring to energy alone, meaning a horse who "came up empty" in a race has been entered in too many races.
If your horse is tired, it needs time off! Watch the energy bar closely, and get a feel for how each horse works. Energy at the time of entering a race does not matter - only what the energy is when it runs. For example, if a horse is at 100% energy and you enter him in 3 races, he would enter the first with 100% energy and then lose energy during the race. In the 2nd race, he would then be less than 100% and would lose more. By the 3rd race, his energy would be significantly lower. For this reason, it's best not to enter a horse in too many races at once until you get a feel for their energy dynamics.
Horses should only be entered at 100% energy except in special circumstances. Entering with lower than 100% energy will result in your horse having a chance to get injured, with the chance increasing the lower your energy is. In general, it's okay to race with >=80% energy as long as you're cautious and realize that there is a risk but your horse will always perform better at 100% energy and you will want your horse in perfect shape for important races.
If you are struggling with energy, there are many items that can help out. Hype will raise energy and is very affordable from the Feed Mill. Alfalfa Cubes will raise energy if it is below 80%. Blazing Horseshoes will raise energy fairly substantially and will also fix low athleticism, which helps both energy and condition for the long term.
Condition is directly influenced by training. Training a horse every game month will keep them in shape. If they are in good condition, they are fit enough to handle racing. If they are unfit, their race performance will suffer. Unfit horses may also be more susceptible to injury.
Note: A horse does not need to be at 100% condition. Ideally, you want condition to be above 50%. Condition will constantly be in decline so it's best to throw in a conditioning type of training in every once in awhile!
If your horse has low condition (perhaps after a long injury or period of neglect), you can raise it quicker by doing a long gallop. This can only be done as the first training session of the meet and won't gain any stat points for that week, but it will get their condition race-ready much sooner than standard workouts do.
Racing builds condition. Once your horse is conditioned enough to race, racing them every month will help them maintain high condition. With younger horses it's suggested waiting until they are closer to 100% to race, but with older horses it benefits you to start racing once they are at 40-50% condition.
Horses will not have extremely severe injuries just for having condition slightly below 50%. Major injuries are still rare. Most horses who are getting major injuries are racing far from the distances they are trained for, on wrong surfaces, with high risk, or with low soundness. If you're concerned about injuries, use Basic Wraps. (Which are a great idea for all horses!)
There are several items that will help condition. Frozen Horseshoes will lock condition to where it does not drop below 70% - very useful for the occasional older rescue! Alfalfa Cubes will raise condition in addition to energy. Get Fit will also raise condition.