http://www.merriam-webster.com/dictionary/serve You could say "The glass serves the purpose of containing liquid for drinking.", but I doubt that Duolingo would accept that as it would be a different sentence in French. "serves" just is not commonly used that way in English. Probably someone reported that it should be allowed and later more people explained why it should not be allowed. That is why sometimes an answer that is accepted would later not be accepted or vice versa. You can report correct answers or incorrect answers, but you should always provide definitions from a reputable dictionary to back up your claim. I would normally say here in California. "The glass is used for drinking."
"The glass serves for drinking" is indeed perfectly good English usage and should still be accepted whether or not the majority of users think it sounds right. I am a proponent of descriptive rather than prescriptive grammar, but not quite to the point that I think usage needs to be reduced to the lowest common denominator to determine what is acceptable.
I am not a French native speaker but I am a Portuguese one, and we use the verb "servir" in apparently the same context in Portuguese. For me the actual translation of this sentence:
"Le verre sert à boire"
Which in Portuguese would be:
"O copo serve para beber"
is this: "The glass can be used to drink". At least in Portuguese, the translation suggested "The glass is being used for drinking" in no way means what the Portuguese sentence above means. Unless French is different and the context of servir is slightly different than the context in Portuguese, shouldn't the sentence "The glass can be used to drink" be accepted?
It is not the French, but the English which makes the difference. The present progressive in English is used more often than in other languages. "Je bois." means both "I drink." and "I am drinking." in English.
Can is another word which is sometimes used in other languages also. In French, "pouvoir" is used to say "The glass can be used to drink." It would be "Le verre peut servir à boire." There is a way to say that in Portuguese as well. "O copo pode server para beber." In English, that would also be "The glass can be used for drinking."
You could say "The glass is used to drink from." but they do not accept that yet. They prefer "The glass is used for drinking." Both English expressions are different from the European Romance languages, adding in prepositions that you did not need.
"The glass is used for drinking." is definitely much more widely used. In English we do tend to use the present participle as a gerund quite often. In French they would use the infinitive. The problem with just using "used to" is that we have the expression "I used to drink" which means "I was in the habit of drinking." and also the expression "He is used to drinking." which means that he does it often enough to be able to handle it. Since we also say "We drink from a glass." or "One drinks from a glass.", the "from" is just to direct your attention away from the other expressions and towards the intended meaning. As for ending a sentence with a preposition, that is not actually considered wrong anymore. If you say "A glass is to drink.", you would be saying that
a glass = to drink
which is not true.
a glass = a container for a liquid that a person would drink
to quaff = to drink (a large amount quickly)
So you could say "To quaff is to drink."
You are right that technically you could say "A glass is used to drink.", but inevitably we would normally add a direct object: for example "A wine glass is used to drink wine." "to drink from" and "to drink out of" are actually commonly used when talking about glassware.
"The glass is used to drink." Is not used much in English. Using the infinitive this way is a French thing (and apparently Portuguese). English speakers most often use the -ing form. "The glass is used for drinking." We could even go one step further and say "the drinking glass."
Of course, it's good that we are learning a bit more about the complex forms of combining French words to express so many ideas and relationships. Specifically, a few lessons now have demonstrated the French use of the infinitive to relate verbs with nouns. I put a link below to an article about this for anybody who is interested.
Off topic, your last sentence is offensive to people of one nationality. I wish you didn't feel the need to express your bigotry on a platform that's seen all over the world.
"verre sert" and "verres serrent" sound the same but "le" and "les" have different sounds. http://dictionnaire.reverso.net/francais-anglais/verre Also "les verres fumés" can mean either "smoked lenses" or "smoked glass" (uncountable, as we count sheets of glass)
http://french.about.com/cs/grammar/a/verbswithprep_4.htm (servir has different meanings with different prepositions after it.)