For one of the picture questions, Duo listed only "Arm" without the "Der", while the other body part pictures had a Der/Die/Das qualifier. Was this an error, or does "Arm" not need a qualifier?
Just a peculiarity of the lesson type. There's nothing special about the word Arm in this regard.
I can not understand what is she saying. Is it just me or do you also can't understand her here?
It's tricky when it's a short phrase that doesn't give much context... But there's unfortunately little we can do about it. Consider the problem noted, however.
I always confuse arm and hand. What's the difference?
An arm is upper arm, elbow, forearm, the wrist and the hand with four fingers and a thumb. Everything that hangs on your shoulder.
A hand is just the very last little piece with four fingers and a thumb from the wrist.