"Salad is Megan's favourite food." This was marked wrong. Are they just being picky?
This is not correct as it would need to reverse the word order:-
eg Salad ydy hoff fwyd Megan.
On the other hand I've now changed my mind and accept that altering the word order doesn't change the sense of the sentence so I'll add it as another possible answer.
I think that changing the word order can change the emphasis in English. Salad is Megan's favourite food could emphasise that it is salad, rather than any other food, that is Megan's favourite, while Megan's favourite food is salad can put the emphthasis on Megan, it is Megan's favourite food, not Fred's.