could this be a physical exercise?
I also wonder about this. Does упражнение include both physical exercise and the exercises given by math and language teachers or a music teacher?
Yes it can be physical exercise(s).
Ive been spelling it exersize this whole time... maybe I should learn english first
The sound is out of service....
Could I say, "I know this lesson"?
Maybe that'd be урок
I'm fairly certain it is.
Would that be "Я знаю эту урок."?
Этот урок, since it is masculine
can uprazhenie also mean practice?
It might, though I'm wondering which context you're thinking of it in.
like in a textbook maybe? a practice at the end of a unit.
Why isn't "I know that is exercise" accepted?
The это is demonstrative and can only mean "this" in this sentence. Similar to Я знаю эту девушку - I know this girl.
So, how do we say "I know that is an exercise"? - "Я знаю что это упражнение"?
I believe "Это" is both a neuter demonstrative pronoun and a neuter demonstrative adjective. And in this sentence, both " I know this is an exercise." and "I know this exercise." could equally be a correct interpretation. Am I wrong?
You are right if we ignore the punctuation. If we don't then "I know this is an exercise." would be "Я знаю, это упражнение." or "Я знаю - это упражнение".