Translation:Yes, everything is perfect. I thank you!
блогодварю is a cognate - has the same root - as European words like French Obligè or English Obliged. It may be so formal that nobody says it much, but I like seeing words in Russian with latinate roots, where we also have retained the expression. 'Much Obliged, guv' nor'
To keep it simple, for "всё" just say "syo" , and for "все" say "sye"
On the other hand, if you want to be exxxtra correct, just say very very very silent "f" in front of them, like fsyo and fsye .
The same rule works whenever you need to say "вс" next to each other ;-)
Just listen to this audio million times, and you'll start hearing that ultra-silent-F ruskies think it's actually there ;-)
This sentence (всё отлично) may be used if someone did something for you (like, repaired a phone or made some shopping) and is asking if everything is done right. As far as I know English, "perfect" would fit better than "wonderful". Like "it is as it should be, couldn't be better".
Yeah maybe, if it means there's no room for improvement then perfect is right. But I thought it was more like the word wonderful (like excellent and great which are also acceptable). I kept getting tripped up in the tests writing прекрасно for perfect and wonderful when I see отлично. Just got to get used to it unless they would add wonderful as another correct translation.
Yeah, though "Blagodaryu vas" is also slightly over-the-top in Russian as well ;-) .
You can usually only hear it during some official announcement, like flight or train schedule change/delay or after all that "What you should do when airplane starts falling from 10km height, besides panicking" rant and then the (recorded) voice says "Blagodarim za vashe vnimanie" (thank you for your attention), while everybody is not paying attention and playing with their phones :-)