Wouldn't a better translation be "We are going along a beautiful city." or "We are progressing/proceeding next to a beautiful city" ? With this English translation people will think it means we are relocating our home next to a beautiful city, which is not what this sentence means at all, unless I am mistaken.
When you learn or practice a sentence, there is a "Report a problem" button on the bottom left after you type in your answer. You can then suggest to "Accept my answer" which is the easiest way for the course authors to add your suggestion. On the mobile apps you can do the same via the flag symbol after answering a question.
Yes, you are right RyagonIV. Unfortunately we cannot say "város közel haladunk", or at least it doesn't sound good to my ears. The original sentence is "...város mellett haladunk". This "mellett" could also mean "near/by/next to/in the proximity of" as far as I know. Köszönöm.