I said "the bed's" and got an error that said it should be "bed is" and that I was missing a space... but duolingo generally takes contractions, doesn't it?
No. "blisko" is just "near", "close to". It's subjective and relative. If you look at a map of a big country, you may say that City A is 'blisko' City B, and it means let's say 20 kilometres.
"obok" is "next to". So it's pretty specific.