Separate letters and vocabulary/grammar testing
I'm very familiar with Hebrew and can read and write. My grammar isn't great but since I learned with nekudot, it should be a given that I can quickly skip the letters practice. Reading without the vowels is probably very difficult to a newcomer. I think you need more drills there and making sure that the student knows what goes where. To me it's just all instinctive because I have seen it so many times.
My placement test had me way at the bottom (level 2) and it comes from not remembering every word and a handful of grammar errors. You may want to choose very simple words that are commonly used to start to really test whether someone knows the alphabet and build from there. For example, while I knew the word for "elephant" I guess most will not. And the word for tail is used in the evaluation? That's also not a commonly used word. Walk, talk, eat, drink, buy, pay, etc. - those are truly beginners words. My walkthrough of testing out the basics will solely be a vocabulary refresher.
Great course and my comments are just my impression IMHO from a very long time of learning traditional Hebrew a while ago. Good luck with this fantastic course.
The placement test isn't a set series of questions - if you get more things right, it will try harder things out on you. If you get things wrong, it'll scale back to easier things. And as a whole, it goes by the order of skills on the tree. Whether you know elephant or not won't make the least difference if you get things wrong in the skills that come before animals. That's just how Duolingo works, and besides choosing how to structure the tree, it isn't something the course contributors have any control over. זנב or פיל didn't come up in the evaluation because someone decided they were the most likely words for people to know!
They had to work within the parameters of what the software will do and how it was designed - in particular, it wasn't designed to teach an alphabet. Several teams have had to face this challenge. The Hebrew team provided Memrise courses for the alphabet and for vocab, so they've done the very best they could given the limitations of the system.
Also remember that each line of skills builds on previous lessons and vocab. Because the structure of verbs is a little further down the tree, once the learner has more of a grip on how things work, most (all?) of the verbs are left until specific verb skills and the units after them.
You can test out of skills individually, so if you come across a skill that looks like being too easy for you, you should probably be able to skip it.